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ARCHIVED DISCUSSION FROM 11/8/2001
All times are U.S. Mountain Time
(Yesterday's Discussion.)
Pandagold
(11/8/01; 23:33:15MT - usagold.com msg#: 64988)
Jb Is there something I missed?
Jb: Yes, regretably, these things go on, but they also work in reverse too. And, I am sure you will agree, Jewish people are more than well represented in the Judiciary, and in the law profession in general in the United States. And many (Jewish people)have shown - even those born in the United States, that their loyalty lies first with the State of Israel, and second with the land of their birth.
You must remember, also, that Bin Laden has been an ally of the United States (perhaps still is if the real truth were known). And there is enough evidence it appears of a close association with the CIA.
Is there some, perhaps even remote, connection here with Gold that I missed?
PH in LA
(11/8/01; 22:53:13MT - usagold.com msg#: 64987)
LOL
"A person that you have accused in your own posts of spewing
communist garbage and who you said never posts about Gold"
Hey BR549:
Don't believe everything you read!
Cage Rattler
(11/8/01; 22:35:14MT - usagold.com msg#: 64986)
ORO
As a long term lurker (and forex trader), I would like to say a very big thank you for all of your posts. Really Appreciated!!
BR549
(11/8/01; 22:16:11MT - usagold.com msg#: 64985)
I know that you have been forgiving of posters mistakes in the past and I request that you and others understand ORO's here.
Leigh (msg#: 64978)---
I was very disappointed in your recent post to me. For someone to say that he would be the last to advocate expulsion and then advocate it various ways in the following sentences, IMHO, is not the way that I read the post of PH in LA. (BTW-A person that you have accused in your own posts of spewing communist garbage and who you said never posts about Gold).
What I suggested in my previous post is for everyone to let the dust settle and let's post about Gold for a while. I continue to advocate that especially in lite of ORO's recent explanation. I know that you have been forgiving of poster's mistakes in the past and I request that you and others understand ORO's here.
BR549
jb
(11/8/01; 22:09:41MT - usagold.com msg#: 64984)
oh my !
a friend e-miled this to me:
"
Is a long-time court-reformer/TV reporter supposed to know about EVERY
judge he comes across? I have been a court-reformer since 1958 and part of a
weekly non-commercial TV program since 1991. Since 1995, I have been the
moderator/producer of the program called "Broadsides", a public access
Cable TV show. I cannot be expected to know every judge. After all, in the
Chicago-area, for example, there are hundreds of judges.
I came to court on October 29, 2001, in litigation involving an associate of
mine, Joseph Andreuccetti who assists with the production of our show in
Chicago. I was there as his paralegal, to take notes, and also as an
alternative media reporter.
Maybe I should have been immediately suspicious when the Judge, Samuel
Betar III [(312) 603-4371], threatened me, apparently to jail me, if I didn't
stop taking notes. He shouted and hollared at me, demanding I go to the rear
of the courtroom. I was alarmed when the judge threatened to also jail Joe
and he had a heart attack.
What was going on here? Understand something. I am a paraplegic in a
wheelchair and Joe and his wife Noemi often drive me where I have to go and
assist me at my residence. I tried in court to wheel over to where Joe took ill,
and the Judge hollared at me and threatened me again. I told the Judge to
stop falsely threatening to jail Joe, since I depend on him. The Judge would
not permit me to go over to see what happened to Joe.
Paramedics along with about six armed guards arrived and took Joe away on
a stretcher. I was not allowed to accompany him or to find out rightaway what
was going on.
My subsequent investigations uncovered plenty about Judge Samuel Betar
III. Later was filed a Motion to try to force the removal of Judge Betar from
the case, to stop him from falsely threatening to jail me and Joe. Filed in
support of that motion are my signed statements of what I uncovered. From
the court record are verbatim what is stated, numbered as they are there
1. I understand this this instrument under [citing Illinois law], has the same
force and effect as if it were an Affidavit sworn to before a notary public.
2. I am a traditional Jew, of the Jewish race and religion. My associates
Joseph Andreuccetti and Noemi Andreuccetti are perceived by their
opponents and enemies as being partly Jewish.
3. Judge Samuel Betar III is closely aligned, including financial, with Suhail
"Steven" Al-Masri who is the Editor-in-Chief and Publisher of the Al-Salam
Newspaper, which has been circulated in the Chicago area and elsewhere."
4. Said Newspaper was operated at 8150 W. 111th Street, Suite 11, Palos
Hills, Illinois, which was the offices of "Steven".
5. Said newspaper has published what those of the Jewish race and religion
perceive as vicious anti-Jewish and anti-Israel propaganda, calculated to
slander and defame those of the Jewish race and religion.
6. "Steven" has been the purported owner of an airplane pilots training
school which has likewise been headquartered at 8150 W. 111th Street, Suite
11, Palos Hills, Illinois. Law enforcement personnel have been surveilling
"Steven" because, they contend, his school has been used by purported
"terrorists" who apparently had and have been planning to seize U.S.
commercial airplanes for the purpose of sabotage and violence to be inflicted
on U.S. persons and properties."
7. Part of law enforcement and other government surveillance of "Steven"
has also included Judge Samuel Betar III, who is financially and otherwise
closely aligned with "Steven" according to such government personnel.
8. According to covert surveillance, "Steven" received numerous calls from
topmost officials in the Springfield office of Ilinois Governor George H. Ryan.
Because of the close relationship of "Steven" with Judge Samuel Betar III
and they, in turn, with Governor Ryan, law enforcement personnel contend
they are precluded from taking any action against either "Steven" or Judge
Betar, or both, jointly. Further, "Steven" has been photographed with Illinois
Governor George H. Ryan."
9. "Steven" has been the owner of Royal Financial Group, Inc.,
headquartered at 8150 W. 111th Street, Suite 11, Palos Hills, Illinois. Law
enforcement personnel contend that said business is, in part, an apparent
front for clandestine dealings with a Foundation in Bridgeview, Illinois[a
Chicago suburb], identified by the U.S. Attorney General and the U.S.
Department of the Treasury, as being a purported "terrorist" linked
organization and enterprise, funneling funds in the U.S. and to the Mid-East
and elsewhere for purported "terrorist" activities directed against U.S.
citizens and properties."
10. As part of activities to promote their front enterprises, as aforementioned,
"Steven" and Judge Samuel Betar III have two slide photographs posted on
his and/or their, website, http//www.noribahomes.com. Said photographs
appear to have been taken inside the judicial offices of Judge Samuel Betar
III for the purpose of promoting their joint businesses and financial activities.
Copies of said photographs, reproduced from said website, are attached
hereto and made a part hereof as Exhibit One." [The said
website-reproduced photographs are in the court record attached to my
signed statement and show "Steven" and Judge Betar.]
11. Law enforcement personnel assert they are precluded from taking action
against Judge Samuel Betar III and Suhail "Steven" Al-Masri, despite law
enforcement contentions that "Steven" and Judge Betar appear to be
Chicago-area links to Osama bin Laden and his al-Qaeda network.
12. According to those who know him well, "Steven" went low-profile, if not
totally disappearing, prior to the purported "terrorist" violence on September
11, 2001, directed against lower Manhattan and the Pentagon. Law
enforcement personnel contend they would want to interview him as to his
activities including with Judge Betar and the airplane pilots training school, as
aforementioned. "Steven's" apparent dropping out of sight tends to support
law enforcement contentions that "Steven" with his aforementioned activities
has something to conceal, along with Judge Betar."
13. Both Judge Samuel Betar III and "Steven" have been in a position to
note that Sherman H. Skolnick has a popular website where he often
comments on activities in the U.S. for and on behalf of Osama bin Laden, the
bin Laden group, and similar persons and groups linked to them. Skolnick's
website is http//www.skolnicksreport.com."
14. As stated in Skolnick's prior [court-filed papers], Judge Betar impliedly
sought to falsely jail Skolnick, a paraplegic in a wheelchair and to seek to
falsely jail Skolnick's close associate Joseph Andreuccetti who was caused to
have a heart seizure in the process of the Judge seeking to falsely jail Joseph
Andreuccetti.
15. As stated herein, the matters here are to be considered as a supplement
to the [prior court papers]. If he thinks he can get away with it, Judge Betar
would again, as a reprisal, seek to falsely jail Joseph Andreuccetti and
Sherman H. Skolnick."
16. As stated in the prior [court-filed papers], Skolnick was the paralegal
accompanying Joseph Andreuccetti on October 29, 2001, for the purpose of
sitting nearby to the proceedings so that Skolnick could hear what was
occurring and take notes. Judge Betar, under the sham and pretense of law,
interfered with and blocked Skolnick from taking notes, which were
necessary since no official court reporter was present. Skolnick understands
that the doings of Judge Betar, to block Skolnick from taking notes of the
proceedings, are offenses by Judge Betar made actionable against Betar by
42 U.S.C.A. Section 1983 et seq. [The Federal Civil Rights Acts, used to sue
State officials for wrongful conduct.] Judge Betar and "Steven" harbor a
deep grudge and deep prejudice against Skolnick and Joseph and Noemi."
17. Under these circumstances, no reasonable person could expect Sherman
H. Skolnick, a traditional Jew, and Joseph and Noemi Andreuccetti perceived
as partly Jewish, to be fairly dealt with in the courtroom of Judge Samuel
Betar III. Judge Betar, under the sham and pretense of judicial authority, has
used his judicial power to terrorize Joseph Andreuccetti and his close
associate Sherman H. Skolnick. This is a reprisal for Skolnick's comments,
assisted by Joseph Andreuccetti, on Skolnick's television program as well as
his website."
18. It is no answer that law enforcement has the power as aforementioned to
take action against Judge Samuel Betar III and his close associate "Steven";
and that such law enforcement personnel are precluded from doing so
because of political and other considerations permitting Betar and "Steven"
to act with impunity against the public safety and interest, and against
Sherman and Joseph." [End of Court document, in Case No. 97 M1-132033,
pending in the Circuit Court of Cook County, Municipal Department, First
District].
Notice these further strange connections. Judge Samuel Betar III is an
immediate family member of Samuel Betar once law partner to David
Schippers, former federal prosecutor and Chicago lawyer, and Special
Counsel to the House Impeachment of Clinton Committee. Perceived by
some as a long-time CIA operative calculated to blackmail Clinton and
others, Schippers was assigned to the Impeachment position by then House
Judiciary Committee Chairman, Cong. Henry Hyde (R., Ill.) As we have
pointed out in several previous stories, Hyde at the same time has been
secretly head of the CIA's "Black Budget" for dirty tricks including political
assassinations. By he way, under the Separation of Powers provision of the
U.S. Constitution, it is unconstitutional for Hyde to wear two such hats at the
same time. Called "Uncle Henry", Hyde supervised the CIA's dope
importing into the Southern states, including through the CIA airport at
Mena, Arkansas. He was boss, of sorts, of those running the dope/gun
smuggling operation, including Bill Clinton, George Herbert Walker Bush,
and Ollie North.
On talk radio, David Schippers contends that through his close contacts in the
FBI, that he found out there was "terrorist" violence expected in lower
Manhattan. Schippers says he has proof he tried, in vain, to force prior
proper action by the new U.S. Attorney General and likewise by the Bush
White House about a month before September 11, 2001. They did not want to
know, Schippers says, and instead his FBI friends are facing reprimands for
having tried to alert the higher ups at FBI. [Notice the related item from
BBC, reported by the Times of India, 11/7/1, based on secret FBI
documents,"Bush Told FBI to 'Back Off' Investigating bin Laden Family".
Questions with no immediate answers Is America's secret political police, the
FBI, supposedly running after "terrorists", going to do anything about U.S.
public oficials apparently linked to "terrorists"? And what is the head judge
of that part of the Cook County Court system going to do, if anything, about
what has been set forth? I brought the matters, as stated herein, directly to
the attention of Judge Jacqueline P. Cox{(312) 603-6132], head of the
Municipal Department, First District, of Cook County Circuit Court.
It seems like the bench and the bar conduct their dirty business quite a bit
with blackmail and even terrorist-style threats. Are there reportedly
"terrorist" linked judges where you are? If so, WHO, if anyone, is going to
do somehing about it?
jb
(11/8/01; 21:47:05MT - usagold.com msg#: 64983)
bush speech
i think bush is full of it. buy gold and silver.this is getting hot .
With Carl Limbacher and NewsMax.com Staff
For the story behind the story...
Thursday Nov. 8, 2001; 10:16 p.m. EST
CBS, NBC Pass on Bush Speech
In the midst of America's greatest national
security crisis since World War II, two of the
three major television networks declined to
interrupt regular programming to broadcast
President Bush's address to the nation
Thursday night on the ongoing war on
terrorism.
Speaking from Atlanta's Centers for Disease
Control, Bush talked about the anthrax attacks
that have plagued the country for the last
month, killing four Americans and exposing
dozens to the deadly bacteria -- including
employees of ABC, NBC and CBS.
But with America at war and the FBI predicting
additional terrorist incidents at home, both
CBS and NBC stayed with regularly scheduled
programming for the half-hour address.
Only ABC carried the Bush speech live.
Rather than switch to Bush, NBC stuck with
perennial ratings booster "Friends," while CBS
carried its own ratings winner "Survivor."
In the past, TV network news divisions have
declined to carry presidential addresses only
when they were deemed not newsworthy or seen
to be too overtly partisan.
Read more on this subject in related Hot
Topics:
Bush Administration
Media Bias
War on Terrorism
A product that might interest you:
Have an Opinion About This? Send an URGENT
PriorityGram Today
Pr
megatron
(11/8/01; 20:53:17MT - usagold.com msg#: 64982)
ORO/#64921
That would be as perfect a description of 'eurocrats' and thier goofball socialism as I ever could have wrote. Thanks for saving me 3 hours. ;>
"Power to the Individuals"
abudahhab
(11/8/01; 20:28:26MT - usagold.com msg#: 64981)
To FOA
Dear FOA,
In today's posting you write, "My spirit is low, I will walk this trail in silence."
I have so thoroughly enjoyed your postings since your return to the forum. To be honest, your views and insight help me keep my spirits up in these very difficult times. I am sure many others here who share my sentiments.
There are plenty of fools in the world. It is best to just ignore them.
Your postings are a truly valuable contribution to our understanding of politics, money and gold. It is important for each of us to make some contibution to help others who otherwise would be gravely hurt by the coming hyperinflationary malestrom. If you message saves only one person from this storm, it is worth it.
We live in very strange times. Some of us here just happen to have the "wrong" type of parents or grandparents or follow a form of monotheism that is greatly misunderstood. The fools have made the lives of some of us quite miserable in recent weeks, and for no fault of our own. We too remain patriots, loving the freedoms that brought our ancestors ot these shores. The fools have to be suffered and ignored, otherwise life would become unbearable.
Freedom of expression is precious. It is the intolerant who would silence all true patriots. No need to walk in silence, your precious words are a gift to those of us with open minds. We hope you will not leave us stranded without a guide.
All the best,
abudahhab
Netking
(11/8/01; 19:59:07MT - usagold.com msg#: 64980)
Arafat advisor: "Peace or war over coming weeks"
http://www.jpost.com/Editions/2001/11/08/LatestNews/LatestNews.37791.html
The next two weeks "vital" . . .
Over the next couple of weeks, the world will witness a dramatic change in the situation in Israel and the Palestinian Authority territories. These changes could potentially effect the entire Middle East region, said Nabil Abu Rudaineh, Palestinian Authority Chairman Yasser Arafat's media adviser. He said that the region will shortly note either an increased stability and move towards peace or a downward spiral into all-out regional war . . . "
ORO
(11/8/01; 19:45:25MT - usagold.com msg#: 64979)
This small dog - bit rather than barked
People, I am sorry to have written personal Email material on the board.
Not having slept the night and still recovering from a nasty cold I did not pay attention to what I was writing, not thinking that it would be public.
Please disregard the two posts if you can, the message was not intended for public consumption and definitely not for FOA to read.
Having taught fluid mechanics complete with incomprehensible integral equations, I can say just that Schaum's outline series stops well short of conveying the complex reasoning behind the simple formulas and the integral mathematical representations do a much better job if you are willing to learn their language.
Economics, particularly when combining quantitative calculations with Austrian theory, is based on simple principles but with long and sometimes complex chains of reasoning.
For the most part, outside the most fundumental of economic principles, if it is simple it is most likely wrong.
Leigh
(11/8/01; 19:16:49MT - usagold.com msg#: 64978)
BR549
I don't think PH in LA will have any reason to regret his defense of FOA tonight or at any time in the future. What ORO said (though he has to some extent apologized) was cruel and insinuating. It's only natural that FOA's fans (Friends of FOA?) speak up for him.
This is no different from yesterday's defense of Reg Howe. Mr. Howe undoubtedly reads all the gold fora and could easily have written in to defend himself against jb's tasteless remarks. He chose to remain silent, and others -- including you -- rose up to defend him.
PH himself said he would be among the last to call for ORO's banishment, I imagine because he believes in free speech. So what are you complaining about?
tg
(11/8/01; 19:01:32MT - usagold.com msg#: 64977)
(No Subject)
Dragonfly- thanks for the link
ORO - keep it coming, right or wrong an alternative view is good for balance, nothing wrong with a good robust discussion. I see nothing offensive in whay you have written.
Black Blade
(11/8/01; 18:55:23MT - usagold.com msg#: 64976)
Workers Are Remaining Unemployed
http://biz.yahoo.com/rb/011108/business_economy_dc_2.html
Snippit:
WASHINGTON (Reuters) - U.S. workers left jobless in an economy battered after the September hijack attacks are staying that way, as companies put hiring on hold pending better economic times, the government's latest figures showed. And with the fear of job losses high, consumers have shifted their spending -- albeit meager -- to discount store chains instead of the more expensive department stores, a trend analysts expect to continue for several months. ``This is a very typical reaction by consumers,'' said Sung Won Sohn, chief economist at Wells Fargo Bank in Minneapolis, one of many economists who expect the labor picture to weaken further over the next few months.
In its latest report, the Labor Department said the number of Americans remaining on state unemployment benefits for the last full week in October was at its highest level in more than 18 years. And while fewer Americans applied for first-time unemployment benefits last week, the level of these initial claims has been substantially higher than levels seen the same time last year.
Black Blade: Yep. And gonna get a lot worse. Time to grab cheap Gold and Silver.
Netking
(11/8/01; 18:34:15MT - usagold.com msg#: 64975)
FOA/Trail Guide
Kia Ora Sir, I have read much on the 'Trail' about the paper trade & derivatives markets & the parting of the ways thereof between that & the physical metal pricing mechanism (starting to happen now yes).
Are you able to give a chronological breakdown scenario of how this will occur for the Au & Ag markets (really one and the same derivative wise IMO) and what "fiat bail outs" will occur (if any)?
- Thanks Netking
BR549
(11/08/01; 18:25:01MT - usagold.com msg#: 64974)
Let's let the dust settle
PH in LA (msg#: 64971)---"Please let me be the last person to advocate your expulsion from this board (although many before you have been sent packing for far more trivial reason). Yet I am not loathe to admit that if offered the choice between the realist (and straightforward) FOA and yourself, the very epitomy of turgid writing and emotional thinking, it should be obvious which I would choose."
Who appointed you or any others at the site steward over here? The comments today by you Matt and I am sure some others are not needed and are not productive.
How about looking back over the past few weeks and see how many accolades that FOA, Another, and ORO have received from the many posters here.
Some of the comments posted here today I am sure will be regretted by all (including you two).
Let's let the dust settle. I for one do not wish to see any of these posters quit posting here or be banned for their ideas or disagreements, and IMHO you are way out of bounds in even bringing it up.
Since everyone is suggesting something, I suggest that we talk about Gold for a while. The Euro and Fed bashing and poster bashing has run its course for today.
Bush is giving a great speech. I for one will devote my attention there for a while.
BR549
Andúril
(11/08/01; 18:21:46MT - usagold.com msg#: 64973)
ORO is no fool
A fool would have no interest in providing the scope seen in ORO's bombastic blather, mixing truth with falsehood in posts to salve over his wounded pride at being caught wrong-footed in the great march of this inevitable, world financial transitional movement. So much barking is the hallmark of small dog complex, impotent against the activity of the real world and lost self-delusional in daydreams.
For those seeking something of investment substance in this, the statement "I buy gold to own" is offered, the bite of a big dog.
Black Blade
(11/08/01; 18:19:31MT - usagold.com msg#: 64972)
Forbes Body Count
http://www.forbes.com/2001/01/30/layoffs.html
More "Bones" cast aside today. The "Bone Pile" grows even higher in spite of the lower new jobless claims. One point to keep in mind as well is the statistical deception involved. The words "seasonally adjusted" mean that the numbers were lowered based on some bogus formula to eschew so-called anomalies. This is the Governments version of "Pro Forma" accounting. Look for the total unemployment numbers to continue growing. In a word - "GRIM"
BTW, George Dubya is addressing the "Fatherland Security" issue on television now. I wonder how many Freedoms and Liberties we will lose in the name of "Security." "Interesting Times"
PH in LA
(11/08/01; 18:01:25MT - usagold.com msg#: 64971)
Foggy Emotionalism
My dear ORO:
How absurd that you chose to charactarize today as "gibberish" the writings of another respected contributor to this forum.
I have never pretended to be an expert on economic matters. However, I do know the English language (among others), in part by springing from a lineage of American citizens that traces its ancestry directly back to the second voyage of the Mayflower and beyond. It should be obvious that my own paltry contributions to this forum are more than enough testimony to this. As obviously learned and pretenciously erudite as your writings usually are, here and elsewhere under different atribution, their import is mostly flawed from the vantage of their organization and content within the English language. Without mincing words, they could very accurately often (and mostly) be called "gibberish" without being far off from the mark.
Another serious flaw in your thought processes can be seen in your excessively personal remarks about FOA today. I refer to your habit of continously coloring your analysis and comments with an overlay of moral value judgements. You casually cite "free markets" as if this paragon of concepts is existent in our present world or even realizable in any utopian alternative. This is an idea that is "out of tune" with reality. Now. And probably always. There are no "free markets" in the USA today, my friend! Maybe there never have been! Your assumption that any would-be creators of a system that does not meet your "pure economics" criteria must be "dishonorable men" is simply another example of your emotion-driven thought processes. Your value judgements suffer from the reality that as passionately as you believe in them, others believe in theirs.
And thus you persist in faulting others (and Another) for living in a real world while you clearly inhabit one that most would call madness.
My friend, you are lost in an emotional quagmire. Your words today make that clear. More clear than any economic concept you have ever tried to explain here. Until you go back to your studies, forget about how you think the world should be, and just be happy to figure out how it actually is, you will always be irrelevant.
Please let me be the last person to advocate your expulsion from this board (although many before you have been sent packing for far more trivial reason). Yet I am not loathe to admit that if offered the choice between the realist (and straightforward) FOA and yourself, the very epitomy of turgid writing and emotional thinking, it should be obvious which I would choose.
I hope that FOA sees no need to absent himself by walking the trail of life, political will and/or economics in silence. This would be an irrational emotional response to irrationality and emotionalism. He should not even request your censure. Your words have exposed your thought processes. Fool that you are, he, as do others among us, can see your head hanging in shame and should merely cease trying to persuade you.
His words and thoughts are clear for all to see.
Today, yours are too!
R Powell
(11/8/01; 17:58:18MT - usagold.com msg#: 64970)
Max Rabbitz asked
"If you don't have confidence in anyone what do you do?"
I agree that physical in hand eases the anxiety.
May I offer another answer?
Don't put your hope in ungodly men, or
Be a slave to what someone else believes.
If you need someone you can trust,
Trust yourself.
-Bob Dylan
Matt
(11/8/01; 17:54:06MT - usagold.com msg#: 64969)
Oro/presentation--
Oro--it's not that I don't appreciate your input as a counterpoint to Trail Guides views (which I believe are being gradually validated by ongoing events), but I also am put off by your mean spirited and insulting presentations.
You seem to be very knowledgable about world economics, but you remind me of a university professor I had many years ago who tried to impart fluid mechanics to our engineering class by filling the chalk board with triple integral equations.
Out in the real world, I gained much more value in just using Schaum's simplistic Outline Series books to compute actual practicable solutions. A very intelligent person usually imparts understanding with simple analogies and messages---such as hiking a trail for example.
Max Rabbitz
(11/8/01; 17:43:09MT - usagold.com msg#: 64968)
Rain on the Trail and jb sites
Depressing day on the trail as a cloud of acidic rain drives hikers to their tents for awhile. I think FOA is right in that the paper markets can and will drive gold to nothing and that paper will burn. All fiats go to zero eventually.
There has never been a time when there have been so many tools available to manipulate markets and public opinion, and the lack of regulatory ethics. Look at what is happening to silver prices when the physical is hard to find (bars) or going up in price (coins). Very strange. This must be the new form of rationing where the little guy is cut out first.....soon to come to the physical gold markets.
I'm skeptical of the euro also, and the desire for excessive regulations/control by the eurocrats. I'm not sure which is worse, the American casino with derivative insurance paper confidence games or them. If you don't have confidence in anyone what do you do? Stay away from other peoples debt obligations and buy the physical.
jb...it would be sufficient to post the link and a comment. There is lots of stuff out there on this topic. Sometimes I wonder who funds these sites and why. Lots of "facts" provided. Those I can check aren't always correct. One statement from the site in your earlier post states that there are 500 years of oil (at current world usage rates) in the Caspian sea region. This is very optimistic. I've heard 50 billion barrels, possibly more are hoped for. Current world usage is 75 million barrels a day and 75mb x 365 days x 500 years = 13.687 Trillion Barrels of oil!!!! Oil should go for about a buck a barrel and Black Blade better sell those energy stocks. I don't think he will. I'm all for freedom of speech and alternative viewpoints, but remember.....rat poison is 98% good corn...or it's not effective. I tend to think of the CIA etc. more as the Keystone Cops using computers and spy satellites and with almost no human intelligence (spies)on the ground providing real information. IMO World Chaos is more probable than one-world government....it's happened before.
ORO
(11/8/01; 17:13:49MT - usagold.com msg#: 64967)
Husky - Socialists
Since the EU is predominantly social democrat and their politics favor central planning and shun the free markets, I am standing by my classification.
Of course the overturning of the euro is no longer a possibility, but the question does remain as to how it is to be used, what methods and mechanics are to stand behind it, and how much of the threatened plan revealed by Another and FOA is on the agenda. Also significant is what the actual economic effect would be.
Gotta go.
Be back later, if I can.
lamprey_65
(11/8/01; 17:04:57MT - usagold.com msg#: 64966)
Today's ECB Rate Cut
Are we now on a race to see who can catch up with the Japanese to zero?!
So much for the 'Euro will lead gold out of the doldrums' theory...
I should have smelled a rat yesterday when Bloomberg trumpeted a causal relationship between a higher Euro and the day's surge in gold.
Waiting for the dollar to break below the '95 bull trend line...
Lamprey
Rockgrabber
(11/8/01; 17:03:31MT - usagold.com msg#: 64965)
MY BELOVED TRAIL GUIDE
Sir, your trail is clear as day. I thought your trail was as wide as a highway, after having walked it behind you for some time. It gets wider and wider it would seem. Even I can fallow now and not get lost. Let those who hike hike, and those who complain, lets just start leaving them behind. No more reason to go back and explain, lets HIKE!! Onward!
Husky
(11/8/01; 16:56:53MT - usagold.com msg#: 64964)
Re: The euro is not the start of something new
"The euro is not the start of something new, it is a continuation of something old. Old and distressed. With financially distressed socialist governments and decrepit ideas of how an economy works." '
Wrong.
Some old-timers have trouble remembering that it was the material prosperity of 'capitalist' Western Europe that convinced the Eastern Block that "socialism" was a decrepit idea. The revisionism inherent in suddenly reclassifying Western Europe as 'socialist' as opposed to 'capitalist' is hilarious beyond words to folks who live here in Europe. It's like listening to folks arguing that the earth is flat. You just sort of smile, let them have their say, and tell them how brilliant their insights are. But you never invite them home for dinner, lend them money or approve of your daughter going out with them.
It is some 10-15 years too late to be declaring war on the Euro, which is what this is all about. The Euro became the single currency it is today because of Thatcher's refusal to co-operate on a version less threatening to US interests. It seems the geniuses behind trying to scuttle the idea didn't grasp that refusing to toss a few crumbs to the hungry would result in the entire cake being stolen. And it has been. It's far, far too late to regret it. It's time to live with it.
ORO
(11/8/01; 16:25:13MT - usagold.com msg#: 64963)
FOA - with no respect to political will
The post that offends you was not intended as a slight against you but as an answer to a personal question as to the apparent transformation in my opinion. If indeed I am a fool, you would do well to ignore me.
You, sir, have aligned yourself to profit from a political move that stands to wreck Europe's economy more so than anyone else's while damaging that of the US and all of the trading partners. While hanging the flag that represents liberty outside your door, you promote as acceptable everything that opposes it. If I suspect some complicity in that horrible event on the part of some members of this administration and some career people in the security services, you should not take offense at my intimation that some among the giants may have had something to do with it.
The political move you have explained is the antithesis of any free market concept. It is not to the benefit of the world at large, it is solely for the benefit of two parties: (1) Europe's governments with the EU bureaucrats and their controlers, who's motives are more suspect (to a free marketeer and believer in liberty) than Stalin's. (2) Arabian oil field owners who feel that they had been cheated by the fact that their product has a declining marginal utility.
Everybody else is among these "giants" is a hanger on. Or an incidental gold saver.
I consider part of the second group (2) to be complicit in the attack on the towers through years of using these same organizations for the purpose of holding on to power to the detriment of the people they claim to care for.
That the US has practiced a monetary imperialism is true. I have worked out the mechanics of its function and attempted to quantify its significance. That the US had to be bailed out (after the fact, I must add) by Europeans who are now trying to do the same thing and worse does not make their moral stature any higher. Nor does it raise yours to present them as the dishonorable people that they must be.
I believe you have been hoodwinked into association with a shameless group of power brokers who have a plan to destabilize the world for their private gain. I don't fault you for the errors of your economic reasoning, nor for falling for their siren's song, as you will stand to gain handsomely from the association and are "paying your dues" to your countrymen by issuing a warning and presenting the reasoning that had been presented to you.
I can never thank you enough for that great effort.
However, I suggest you open your eyes to this and see that though cloaked in self-righteousness these people are self serving parasites on the backs of their people. I can not say that their American counterparts are much better, nor were most of their predecessors.
Finally, fool that I am, I had not considered your feelings in that writing. I apologize for having caused you such distress.
jb
(11/8/01; 16:06:17MT - usagold.com msg#: 64962)
more stuff
if this is all true ,buy gold and silver, this war is going on for along time and the end will not be that pretty.their are a 100 people or in this world who ware bent on getting control of the world(read that as money) or if they do not get it they will destroy it.(but not on purpose though),that is what i think.the internet provides us with alot of knowledge and i am wondering when the "powers"will take the internet away from us ,in the name of home land security?we are learning to much for their own good.
Intelligence Review.
`Wolfowitz Cabal' Is an Enemy Within U.S.
by Michele Steinberg
On Oct. 14, the London Observer published one of the now
familiar—and totally false—propaganda scare stories, entitled "Iraq
'Behind U.S. Anthrax Outbreaks.' " The story gave credence to the
ravings of "American hawks" who say there is "a growing mass of
evidence that [Iraqi President] Saddam Hussein was involved, possibly
indirectly, with the Sept. 11 suicide hijacks." If confirmed, said the
Observer, "the pressure now building ... for an attack [on Iraq] may be
irresistible." One of these "hawks," an unnamed U.S. "administration
official," told the Observer that British Prime Minister Tony Blair is a
"faithful ally" in the war against terrorism and that "if it means we are
embarking on the next Hundred Years' War, then that's what we are
doing" (emphasis added).
The "next Hundred Year's War"? Who are the U.S. maniacs who use
such language, and are they not as dangerous as Osama bin Laden's
jihad?
Here we will name the names of the fanatics in this anti-Iraq grouping
who have become known as the "Wolfowitz cabal," named after
Assistant Secretary of Defense Paul Wolfowitz. According to the New
York Times, which published a leak about their activities on Oct. 12,
this grouping wants an immediate war with Iraq, believing that the
targetting of Afghanistan, already an impoverished wasteland, falls far
short of the global war that they are hoping for. But Iraq is just another
stepping stone to turning the anti-terrorist "war" into a full-blown "Clash
of Civilizations," where the Islamic religion would become the "enemy
image" in a "new Cold War."
The "Clash of Civilizations" theory, developed by Harvard
professor-turned President Jimmy Carter's National Security Adviser
Zbigniew Brzezinski and his protégés, including Harvard Prof. Samuel
Huntington, defined the Arab and Islamic world as an "arc of crisis"
from the Middle East to the Islamic countries of Central Asia in the
then-Soviet Union. Brzezinski wanted to use the "Islamic card" against
the Soviet Union, and in so doing, began the policy of promoting
Islamic fundamentalists against moderate and pro-Western Arab and
Islamic governments. After the end of the Cold War, the
Brzezinski/Huntington crowd updated their "arc of crisis," declaring that
the Islamic religion is the enemy, in a new war in which religions, rather
than political systems, inevitably battle each other. However, trained by
British and U.S. special intelligence services and the CIA, and armed
by Israeli military networks, the very terrorist drug-runners in the Islamic
world who were launched by Brzezinski and "adopted" by the
Iran-Contra networks run by Lt. Col. Oliver North, under the elder
George Bush's Executive Order 12333, have become the main
suspects in terrorist attacks against the United States.
A Network Throughout the Government
The adherents of the so-called "Wolfowitz cabal," pushing the
"Clash of Civilizations" theory, are nothing less than "an enemy
within" the United States, a network that cuts across the Defense
Department, the State Department, the White House, and the
National Security Council. This report is not a "good guys" versus
"bad guys" description of the Bush Administration; rather it is a
warning that this cabal is a close-knit rogue network that is
trying to hijack U.S. policy, and turn the current Afghanistan
mess into a global war. The cabal bears a dangerous
resemblance to the "secret parallel government" of North and
Gen. Richard Secord's "Project Democracy" operation that ran
Iran-Contra. In fact, some of the cabal members now in the Bush
Administration are convicted criminals as a result of their activity
in North's "Enterprise"!
On Oct. 12, the New York Times revealed deep divisions in the
Bush Administration, describing how the cabal plots policy
behind the back of Cabinet officials, such as Secretary of State
Colin Powell, in the name of the U.S. government. The group
wants to obliterate Iraq, put Palestinian Authority President
Yasser Arafat and the Palestinian Authority on the terrorism list
(if not the obituary list), and declare war on nation-states.
The Times revealed that a key section of the "Wolfowitz cabal,"
is the 18-member Defense Policy Board, which met for more
than 19 hours on Sept. 19-20 to "make the case" against Saddam
Hussein. The meeting pushed for a renewed war against Iraq as
soon as the war against Afghanistan had concluded its initial
phase. It discussed overthrowing Saddam Hussein, partitioning
Iraq into mini-states led by U.S.-funded dissidents who would
steal the proceeds from the Basra oil revenues for their quisling
government. The meeting discussed how to manipulate
information so as to pin the Sept. 11 attacks on the United States
on Saddam Hussein.
According to the Times, Secretary of Defense Donald Rumsfeld
attended the meetings for only "part" of both days, and on Sept.
22, President George Bush rejected the Policy Board's
recommendation to declare war against Iraq. But to the
"Wolfowitz cabal," Bush's decision didn't really matter—senior
members of the Policy Board had been selected for their broad
international connections, especially to the United Kingdom and
Israel, allowing them to force changes in U.S. policy through an
"outside-inside" operation. If unable to change policy through
advising, the network could also run covert operations as a
"government within a government," as they had maneuvered
during Iran-Contra.
The chairman of the Defense Policy Board is Richard Perle, the
former Reagan Assistant Secretary of Defense for International
Security Affairs, now based at the neo-conservative American
Enterprise Institute.
Perle, nicknamed "The Prince of Darkness" because of his
nuclear Armageddon views during the Cold War, is, more
importantly, an asset of Conrad Black's Hollinger International,
Inc., which grew out of British Empire Security Coordinator
William Stephenson's efforts to secure arms for Britain during
World War II. At present, Hollinger owns the British Tory
Party-linked Telegraph PLC, whose International Advisory Board
is headed by former British Prime Minister, now Lady Margaret
Thatcher. Hollinger also owns the Jerusalem Post, another
war-mongering press outlet.
The "heavy hitters" on the Defense Policy Board are the worst of
the Anglo-American-Israeli geopolitical fanatics from the last
several decades, including: former Secretary of State Henry A.
Kissinger, who is also a member of Hollinger's International
Advisory Board; former House Speaker Newt Gingrich; former
Clinton Administration Director of Central Intelligence R. James
Woolsey; former Deputy Chairman of the Joint Chiefs of Staff
Adm. David E. Jeremiah; former Vice President Dan Quayle;
former Defense and Energy Secretary James R. Schlesinger; and
former President Carter's Defense Secretary Harold Brown.
Though Perle was only recently appointed to head the Defense
Policy Board, he and Wolfowitz have been collaborators for
more than two decades, as agents-of-influence of the right-wing
Israeli war faction. In 1985, when it was clear that Jonathan Jay
Pollard, an American convicted that year of spying for Israel,
could not have been working alone in stealing such high-level
U.S. secrets for Israel to sell to the Soviet Union, top-level
intelligence officials told EIR that an entire "X Committee" of
high-level U.S. officials, was being investigated. Wolfowitz and
Perle were on the list of "X Committee" suspects, and Israeli
spying against the United States was so thick that investigators
told EIR they had found "not moles, but entire molehills." Pollard
and his Israeli defenders later claimed that Pollard "had to" spy
against the United States because the Americans were soft on
Iraq and other Arab countries.
The "Wolfowitz cabal" is deterimined to push the United States
in the direction of the most dangerous Israeli right-wing policy,
including a possible Israeli nuclear attack on an Arab state. They
are implementers of the very "breakaway ally" scenario about
which 2004 Democratic Party Presidential pre-candidate Lyndon
LaRouche warned in his statement of Oct. 12 (see International).
Plan B: Wagging the Dog
The "Wolfowitz cabal" is out to destroy any potential for a
Middle East peace, and simultaneously is determined to crush
Eurasian economic development centered around cooperation
among Europe, Russia, and China. After being rebuffed after the
marathon Defense Policy Board meetings, the Wolfowitz cabal
set various operations in motion to plant propaganda stories,
falsify reports of U.S. policy, and carry out other maneuvers,
whereby the tail would "wag the dog." Unapproved statements
are made by cabal members, interviews misrepresenting U.S.
policy are planted around the globe, and intelligence reports are
altered or manufactured to further the policy goals.
The pattern is becoming crystal clear.
In the first such instance, shortly after the attacks of Sept. 11,
Wolfowitz declared that the United States will "end states
harboring terrorism," and insisted that under the principle of
self-defense, the United States could act alone, without the
United Nations, or cooperation from any other country. He
wanted to establish the "doctrine" that the United States would
hit a country "anywhere, anytime" based on secret evidence.
But, Wolfowitz was forced to retract his statements, in a visible
rift with the White House. Some days later, NATO allies at its
Brussels headquarters snubbed Wolfowitz, and refused to
formalize cooperation with the United States under NATO
agreements at a meeting where Wolfowitz represented the Bush
Administration.
In the same vein, on Oct. 7, the day the Afghanistan bombings
began, the cabal again attempted to provoke a rift between the
United States and members of the UN Security Council,
especially Russia and China, by altering the text of a letter from
U.S. Ambassador to the UN John D. Negroponte. (Not
coincidentally, Negroponte was a notorious insider in the
Iran-Contra operation, who was accused of collaborating with
narcotics-linked military death squads in Honduras in the 1980s.)
The changes in the letter were made without notifying
Negroponte's boss, Secretary of State Powell.
In the letter, Negroponte echoed Wolfowitz's so-called gaffe,
writing, "We may find that our self-defense requires further
action with respect to other organizations and states" (emphasis
added). The statement implicitly targetted Iraq, Syria, and
Sudan, all countries which are on the State Department's list of
countries that support terrorism. The statement violated promises
the United States had made, that it would limit "coalition" action
to redressing the attack of Sept. 11. Upon learning of the
statement, from the press, Powell reportedly "hit the roof." The
insertion was drafted by Stephen J. Hadley, who is the Deputy
Adviser to the National Security Council. The stunt may have
been planned at the Defense Policy Board meetings.
Then there's the case of former CIA director R. James Woolsey,
whose defined role is as the Policy Board member who is most
public in demanding the overthrow of Saddam Hussein. The
Knight-Ridder newspaper chain reported on Oct. 11, that
Woolsey had been authorized the prior month to fly to London
on a U.S. government plane, accompanied by Justice and
Defense Department officials, on a secret mission to gather
evidence linking Saddam Hussein to the Sept. 11 attack. In a
Sept. 18 press conference by Defense Week, Woolsey called for
creating a "no-fly and no-drive zone" in the north and south of
Iraq, so that the Kurds and the Shi'ites, respectively, could better
fight Saddam. "The watchword of the day," Woolsey said, is, "It's
the Regimes, Stupid!"
Since the Oct. 5 death from anthrax of Bob Stevens, the Sun
tabloid photo editor, from anthrax, Woolsey has been the world's
leading finger-pointer at Saddam as being behind the anthrax
attack. His so-called evidence is dated, prejudiced, and
completely unreliable.
It was no accident that Woolsey role-played a prominent
character—CIA Director—in the New York Council on Foreign
Relations 1999-2000 scenario the previous year, "The Next
Financial Crisis: Warning Signs, Damage Control, and Impact,"
that acted out a virtual coup d'état coming on the heels of a
combined financial crisis and terrorist attack. In the CFR
war-game, the U.S. President would be taken out of the picture,
leaving the country under the control of a crisis management
dictatorship.
Also dispatched to London to propagandize for a "rolling war"
that would attack Afghanistan, then Iraq, then country after
country until revenge is exacted, was fellow Policy Board
member Newt Gingrich. Talking to the London Times, owned by
top British-Israeli propagandist Rupert Murdoch, Gingrich said
that the United States is "at war" with "organized, systematic
extensions of terror, supported by nation-states." He said that
targetting the Afghan Taliban without defeating Iraq would be
"like defeating Imperial Japan and leaving the Nazis alone."
Gingrich threatened that countries judged not cooperative
against terrorism would face the consequences: "The U.S. and
the coalition forces will assist your own people in removing
you."
Setting the pace for his team, Perle was the joint initiator with
neo-con William Kristol of the Rupert Murdoch-funded Weekly
Standard, of an open letter to President Bush, that, while
ostensibly supporting the President in the war against terrorism,
was, in fact, an ultimatum to support a "Clash of Civilizations"
Thirty Years' War in the Middle East. Among the non-negotiable
demands set forth in that letter was the overthrow of Saddam
Hussein, "even if evidence does not link Iraq directly to the
[Sept. 11] attack."
There is no doubt that the Wolfowitz/Perle duo is at the heart of
the network that can use Israel in the "breakaway ally scenario."
Indeed, Wolfowitz is one of great hopes of right-wing extremists
in Israel, including among the radical settlers movement, who
are demanding the assassination of Arafat and the expulsion of
all Palestinians from the Occupied Territories (see coverage in
International). But, Wolfowitz and Perle are not "Israeli agents."
Rather, they are second-generation operatives both mentored by
the RAND Corp.'s Albert Wohlstetter, a former Trotskyite
communist turned nuclear strategist. Nor are the cabal
war-mongers Seven Days in May militarists.
A key member of the cabal is Richard Armitage, the number-two
man in the U.S. State Department, who was investigated in the
Iran-Contra scandal, and who is a longtime collaborator of
Wolfowitz in the targetting of Iraq. The cabal also has high-level
operatives at the National Security Council (NSC):
Gen. Wayne Downing, former Commander in Chief of the
Special Operations Command, was just appointed as Director of
Combatting Terrorism for the Homeland Defense Board, headed
by former Pennsylvania Gov. Tom Ridge. In 1997-98, Downing
drew up a military plan to overthrow Saddam, by assassination,
if necessary. The plan hinged on heavily arming dissident gangs
of Iraqi Shi'ites in the south of Iraq, and Kurdish fighters in the
north. Invasion by U.S. Special Forces ground troops was not
ruled out. The promoter of the neo-Conservative yahoos in
Congress and the think-tanks was Wolfowitz, then head of the
Paul Nitze School of Advanced International Studies at Johns
Hopkins University. Unable to ram this plan through the Clinton
Administration, Wolfowitz shopped the plan to Perle, an expert
in "chain-letter" pressure politics, who garnered signatures. Now
at the NSC, Downing has the ready-made plan to hit Iraq.
Richard Clarke, Adviser to the President for Cyberspace Warfare.
Clarke, who was originally with the State Department during the
elder Bush's Administration, was demoted for covering up Israeli
violations of the Arms Exporting laws. In August 1998, Clarke was
one of the key figures who planted false information about
Sudan's involvement in the East Africa U.S. Embassy bombings,
which led to U.S. cruise missile attacks on a Sudanese
pharmaceutical company in Khartoum. Clarke shopped in
disinformation from British-Israeli covert operations stringer
Yosef Bodansky that targetted Sudan.
Elliott Abrams, NSC staff. Abrams, who was convicted in the
Iran-Contra scandal, was quietly placed on the NSC as a
specialist in "religion and human rights." He is a longtime
member of the right-wing Zionist networks that infiltrated the
U.S. security establishment. He worked closely with Secord and
North in Central America, also providing a link to the Israeli
gun-running networks that delivered arms to Khomeini's Iran.
Galearis
(11/8/01; 15:56:05MT - usagold.com msg#: 64961)
@Netking
I'm a fundamentalist, my friend
(smile)
Back in '93 when poor ol' silver carved itself out its last most recent hole to crawl into, the fundamentals were bullish. It has been increasingly bullish with ever increasing demand shrinking ever decreasing supplies and the one conclusion I come to is that T.A. predictions of market behavior as opposed to fundamental supply demand economics seems to have parted ways. I think someone else stated that today, almost as if this was some sort of team sport cheer-lead prompt (smile).
I think for both gold and silver bugs (I'm a hybrid, [smile]) the one thing that I am sure about is that neither gold or silver will be set free until there is a change in the political/fiscal climate to foster it AND/OR we run out completely of both metals. Since there is twice as much gold out there than silver, silver will probably go first. Given that we are down to this point - where supply/demand fundamentals are ignored (papered over) - I cannot even say for sure (given Pd) that there will ever be a rational response in exchange value in the market environment. When we run out of silver, for example, will it even matter if they re-write the ways and means of its exchange? There is WAY less silver around now than during Buffett's grab... you see? Besides what is $3.60 in 2001 dollars with a 7 to 10% inflation rate over the last three years? At this point that whole scenario is academic when reality is positively surrealistic.
So I just don't bother with that end very much.
Bottom line: This may blow up (probably will) when they run out or there is a realistic perception of the supply realities. Or a REAL left field event intervenes.
Probably not before.
What I also think is that this IS the bottom - at around $4.12 and further declines of today in both gold and silver will imply collapse in the paper markets.
But 'they' know that too, yes? The T.A.'s will likely continue to be satisfied at least. (smile)
Regards,
G.
Leigh
(11/8/01; 15:27:14MT - usagold.com msg#: 64960)
FOA
My spirit is low, too. I don't know what has gotten into ORO this past week. My warmest wishes to you and to ANOTHER.
site steward
(11/8/01; 15:26:34MT - usagold.com msg#: 64959)
HEADLINE: China to channel more forex reserves through HK
http://business-times.asia1.com.sg/news/story/0,2276,27198,00.html?
In this small glimpse of a larger picture, I'll leave it to the reader to imagine how China will ulitimately find it to be in its best interest to conduct financial operations.
Excerpts:
------BEIJING may once again lend Hong Kong a helping hand in its current economic difficulties, this time by letting more of its US$200 billion foreign exchange reserves be managed in Hong Kong. This latest move will benefit Hong Kong's foreign currency, gold and bond markets, as well as fund managers and financial institutions here.
China is said to have the second-largest pool of foreign reserves in the world - after Japan - with over US$200 billion invested in bonds, gold and foreign currencies in markets around the world. It already uses Hong Kong fund managers and investment banks to trade some of these reserves.
Chi Lo, Standard Chartered Global Markets chief economist (North-east Asia), says that this latest news is definitely positive for the development of Hong Kong's financial markets.
'If the money is put in bonds, it will further develop and deepen the bond market. If it is traded in forex and gold markets in Hong Kong, it will help these markets.'-------
China does not act in a vacuum, and the position of gold within the new European currency structure must seen as part of the larger picture here. Is your portfolio prepared to benefit from a new international paradigm which is supportive of physical gold?
R.
Netking
(11/8/01; 15:24:39MT - usagold.com msg#: 64958)
Pentagon to send 4th carrier to Afghanistan
http://www.washingtontimes.com/national/20011108-75776015.htm
The Pentagon is set to dispatch a fourth aircraft carrier battle group to waters near Afghanistan, and the ships could depart for the region as early as this weekend . . .
Cmdr. Jack Papp, spokesman for Navy air forces in the Pacific, declined to comment on the Stennis' early deployment. The Stennis has not yet received a deployment order, but Cmdr. Papp said planners have the "flexibility to respond to emerging operational requirements". . . "
sourdough
(11/8/01; 15:21:58MT - usagold.com msg#: 64957)
Japan and gold
Can anyone see a possibility of gold being used as a "tool" for jolting the Japanese consumer into spending again.
"Jipangu" is providing access for Japanese investors to buy into Canadian gold companies while the currency and the market values are depressed.
Could the CB`s decide to get gold into the hands of the Japanese (4 dollar drop today)at a fair gold/yen price, then engineer a windfall gold price rise to 6 or 8 hundred dollars.
I am wondering if this windfall to the Japanese consumer Along with investor windfall through Jipangu would snap them out of their recession?
Could gold be used as a useful economic tool in a manner like this?
If I understand correctly the Japanese consumer has savings. Does anyone see where an "engineered" windfall could assist in getting their economy booming.
If so, how high a gold price, and how much gold would be needed to be "allocated" to the Japanese consumer to achieve this pleasant shock to get the world economy back on track?
Gold Trail Update
(11/8/01; 15:10:36MDT - Msg ID:64956)
The Gold Trail Discussion has been Updated
The Gold Trail Discussion has been updated. Click on the link to read the latest updates.
ORO
(11/08/01; 15:04:03MT - usagold.com msg#: 64955)
Exactically BR549
The euro is not the start of something new, it is a continuation of something old. Old and distressed. With financially distressed socialist governments and decrepit ideas of how an economy works.
These govs. are already ignoring Dim Wim's exhortations to deregulate and scale back and instead are seeking to raise their deficit spending limits above 3% of GDP.
As to anyone who thinks a free gold market is possible when the CBs hold 40% of the gold, think again. What is then to prevent a government to try and rebalance the big hole in its books a-la IMF with a "gold bubble", issuing tonnes of cash for the purchase of bullion, thereby making the currency worthless and gold scarce? What would prevent them from dumping the gold when it is cheap and they need to raise actual resources after the "gold bubble" is pierced and the books don't balance anymore?
The only way out of manipulated gold markets is to have all the governments dump their gold on the market once and for all, and to write into their constitutions that they can not accumulate gold or silver, or any other monetary metal, nor regulate who has it and how they chose to trade it. If they retain a fiat money system, they would be prohibited in participating in the setting of gold prices. They can (should) allow its use as legal tender at market prices.
Mr Gresham
(11/8/01; 14:48:11MT - usagold.com msg#: 64954)
Oro -- Yikes!
Hardest working man on the 'Net, from scanning today's!
(When will I have time to read? And then: to think?!? Weekend ahead. P.S. Keep it coming...)
Netking
(11/8/01; 14:33:10MT - usagold.com msg#: 64953)
Galearis - Ag
Galearis(64933) The 'Saudi Factor’. . . With 10% of the worlds oil production any disruption through Islamic fundamentalist activity would cause massive ripples through the financial infrastructure for sure.
Galearis, any comment on the Ag cycle forecasts from post #64908 last evening(& attached link). This goes against E Waves who I think have spent too long on 'Deep Space 9' with some of their market calls, I just don't think $3.50/$3.68 is possible given the physical supply situation. However $4.11'ish "fits" as does end 2001/early 2002 for the cycle.
BR549
(11/8/01; 14:25:41MT - usagold.com msg#: 64952)
I probably missed something somewhere, but one other thought in reference to the Euro and inflation—
If the ECU is swapping Euro's for member countries fiat, then doesn't it make sense that since each local currency has imbedded inflation that the Euro will absorb, that the Euro will be inflation based fiat just like the dollar?
BR549
ORO
(11/08/01; 13:59:17MT - usagold.com msg#: 64951)
BH - my 5/25/2000; msg# 31228 needs some updating
I'll try to put some time into reworking that piece. I have learned some since that time. Furthermore, there are a number of additional contingent issues as to the choices the Fed and other CBs end up making, as well as tax/reg policy.
The ultimate values need not be reached under all circumstances. Furthermore, leverage in the dollar arena turns out to be less than it appeared at the time. Furthermore, much of the gold paper outstanding at the time has either been netted or expired. After tax returns are to be considered rather than plain vanilla ones, and the 5% returns considered at the time were GAAP earnings, which I noted lately are misleading and lower than realizable earnings going forward.
Thus, for the reader of that post I should warn:
1. Tax policy issues will dictate the degree of aggregate reallocation from fiduciary to tangible assets.
2. There is a later post with more refined projections.
3. There is little the dollar suffers from which the euro does not.
4. If one takes the Dow gold ratio and looks for a repeat of the proportions of price moves both nominal and real one had better consider whether tax rates would rise as they did then, because that factor alone contributed at least 30% of the price move directly. And a much larger portion was moved from financial to tangible assets by this taxation shift than by the actual change in cash flows.
5. Furthermore, the EXCESS monetary inflation of the 60s and 70s was far greater in scale than anything since, and much of the old inflation had already been released into prices.
6. Another item of note on using the Dow gold ratio for guidance is that the 70s spike down in the ratio was the abberation and would NOT happen this time because gold has not been fixed in price by statute but by market action.
7. The profit/revenue relationship is not 20 as presented in that post, but more like 8.
The basics are still generally right but less of a kick would be obtained by a break of par in the gold market because there is less "paper" to replace.
As to the question of whether the market would actually break, depends on whether the Fed actually reflates fully or retains the current attitudes (essentially to let the bankrupt go bankrupt), and whether it gives us a fright upon the resurgence of global dollar borrowing by reacting too slowly. If the resurgence is split with the euro in borrowing volumes, then the problem for the dollar would be much smaller.
If a "gold bubble" scenario such as I suspect might still be in the works, then there is no practical limit to gold prices, but in this case I would flee europe and forego anything related to the euro, because the results would be much different from those FOA and his "political will" expect.
FOA's idea of a "free market gold price" is an artificial bubble created on purpose: in order to make the ECB's lossy books whole and to cover oil-land's beggary of misbegoten "non-Western" asset allocations with winfall profits from a completely artificial gold price. The bottom line is that it would be a simple "wealth transfer" mechanism of the kind we know as theft by market rigging - just that it would be in the opposite direction from the one we are familliar with.
Since FOA indicates that there seems to be a willingness to allow "legal tender" for gold in euro transactions, I don't see a reason for anyone to actually hold euro.
BR549
(11/8/01; 13:35:49MT - usagold.com msg#: 64950)
POG not in dollars but as a basket of commodities
ORO (msg#: 64945)---
I have difficulty with some of the perceptions about CB generated "debt traps" but that is for another post.
I do agree with the pegging of the dollar by the Fed based upon a speech given by Greenspan several years ago, where he admitted that an unofficial Gold standard was one of the functions of the Fed. I have maintained that this mythical Gold standard price is around $275/oz. and if you look in constant dollars, the POG bounces back from the top of its volatility at $300/oz. back into this area. I am convinced that the Fed, in association and conspiracy, with CB's and BB's around the world have conspired to maintain this pegged price for their benefit. The IMF, World Bank, and BIS equally benefit from a non-rising Gold price.
I have also advocated that when Gold is priced in dollars, then that provides the incentive to inflate/deflate FIAT or buy/short sell Gold to maintain this standardized price. But if Gold was priced in a basket of world commodities similar to the way that the world's fiat is settled (exchange rates) by CB's, then Gold would become the standard, rather than the USD. There is already an index that is being used for this "basket of commodities" so the conversion would not be a difficult task. These basket of commodities reamin constant around the world, and the local currency is valued in its relative buying power. There is another basket that has been set up by JPMC, I think called their GSCI, which they maintain for investing in many commodities including Gold and Silver. They allocate their investments between about 5 or 6 different categories. If I recall when I last looked, over 60% of their total allocation now is in Energy with PM's getting less than 3%.
Randy and I kicked this around a while back. If interested for additional discussion, I will dig back into my previous posts on pricing the POG as a basket of commodities with references on how its currently being done with the world's currencies.
I think that if the Fed would begin thinking in these terms, the Euro will not be the replacement of the FRN, value based Gold will be. Of course, if Mr. Howe is correct in his assumptions (and I think that he is), then the Fed cannot change its ways—it's too late.
Regards,
BR549
BH
(11/8/01; 12:36:32MT - usagold.com msg#: 64949)
ORO
Sir Oro, is your analysis in (5/25/2000; msg# 31228) still valid and if so, when do you expect such events to occur?
Thank you.
ORO
(11/8/01; 12:10:55MT - usagold.com msg#: 64948)
ge and Cavan Man - gold and ponzi debt
The main thing seems to escape you guys, I am still here at a gold forum, and still advocating physical gold ownership. However, I do not say "all paper will burn", and I definitely don't send demented religious fanatics to crash into the paper trading house and burn it down.
Even if Greenie is operating a hidden gold standard or some cousin of it, it can only hold within some limits as to distortions in the structure of debt and economic cash flows. I believe the structure has been stretched thin with financial twists and turns and may never return to its intended form. The evidence before me shows that it was not predominantly the Fed that did it, because it was not the Fed that had 0% interest rates for half a decade. Nor was the US the one country where government threw resources into the sea more so than another.
The ponzi finance is most strongly present in Japan where trillions of yen sit in matresses, and yet trillions more sit in accounts that were lent overseas because no one in Japan would borrow because there was nowhere to invest the funds and turn a profit. The carry operators from Japanese yen to other assets are the most precarious, as are their creditors among Japanese institutions, and the issuers of the debt and equity thus purchased with leverage.
The bulk of this is dollar denominated and is being "restructured" as we speak. But the yen must adjust appropriately, it needs to fall in order to balance prices in Japan with global prices, but it must rise because of the debt demand on the global market - the fact that where there is a carry trade there would be a disproportionate supply of the high rate currency relative to the low rate currency must drive the low rate currency upwards unless more of it is printed to buy the high rate currency, or see it rise so high that the leveraged carry borrowers go bust along with the Japanese banks that lent to them. The overbuilt Japanese export industry would not be able to survive such an upward move in the yen, and its meager cash flows would turn negative, throwing its debt into default, and/or its workers into the streets.
US investors are not that heavily into the carry trades and are likely to suffer on an exposure basis. The dollar demand for repayment of weak debts has contracted through debt-equity swaps, default, and IMF assisted "restructuring", which shows a drop in non Japan Asian debt to 1/2 its peak level. Unfortunately, the Latin American debt has not worked out that well. Russian debt has been largely liquidated.
The time for fear for the dollar is not during this portion of the deflationary wave but when it reverses and international dollar borrowing resumes with a much reduced debt base. The Fed's work would have to be immediate and swift in order to avoid a suddenly positive and large supply demand balance while the Fed has the spigots wide open.
That is why I take gold.
The other issue is political insurance, the value of gold relative to financial assets (and thus dollars) also depends on the tax rate - both on the collection end and on the spending end - the only portion of the asset's returns investors care for are the net returns after taxes. If congress continues on its current binge, then de-facto taxes will have risen and the value of financial assets would drop relative to gold as actual returns fall, thus pushing more people out of investments and into tangible savings. Hopefully they will not go on another bender, but we can't assume so. and must protect ourselves from it with GOLD.
escapethematrix
(11/8/01; 12:04:26MT - usagold.com msg#: 64947)
Why I love to see "paper gold" burning....
Snippets from Gold Trail message 117.....
Mike, while I'm writing this, I see gold selling off (silver more so). Once again, we see where the paper based trading has plenty of selling power and completely dominates the physical fundamental markets. How may postulated, even just a few years ago, that with the fed expanding the money supply by a year to date "one trillion"; that paper gold could not reflect this inflation? This only further confirms that this form of market "hedge" is failing to function for its owners
In order to push dollar holdings further, international players needed and purchased "paper financial hedges" to balance their risk. Within their total mix of derivative hedges were found "paper gold price hedges"; modern gold derivatives. The important thing to remember is that these positions are not and never will be used to demand physical gold. They are held to buffer financial and currency risk associated with holding any form of dollar based asset. To work these items don't need to really perform "dollar price movements" in the holders favor as much as they are present in the portfolio to act as insurance stickers.
For the first time in this portion of the dollar's timeline and our lifetimes, such an inflation is about to show its face!
Paper gold derivatives became a major force in allowing this last, end time, demand for dollars and subsequent surge in it's value. This is why Another said it would run way up, even while being inflated, before the end would come.
With the world dollar gold markets completely locked from rising and performing their portion of a hedge function for your portfolio,,,,,,, because, if they rose trillions would be lost by the writers,,,,,,, what asset based currency would you escape into?
They( Euroland) say: We understand that there will be an inflationary transition form this dollar world because we, ourselves, must absorb a certain portion of all the past created dollar inflation. A portion of pain we and the world must all bear in order to economically get pass this period. But, at least, we offer a position in the wealth of ages to reflect this financial loss as it is manifest in price inflation.
Me: So, it seems to me that as the equity markets inflate, the "big boys" gold paper hedges can no longer perform their true function as said "paper hedge". This is seen via a falling "paper gold" price in the face of such inflation. Thus it would seem that these "vehicles" must be abandoned if they no longer can function as designed.
A few questions for ORO: What do you think will happen when the long awaited physical only gold markets truly open? Do you think that this will or will not occur? Do you see a "paper only" market existing alongside them? Lastly, in A physical market only scenario, what price would you put on an ounce of bullion? .
Thanks to both you and Trail Guide for all your efforts to enlighten.
jb
(11/8/01; 11:38:53MT - usagold.com msg#: 64946)
oil ,gas and the usa gov't.
this was taken from a stockhouse forum comment,pretty well sums it up right?more reason to buy gold and silver because this war is going to become ugly.
"Same Old Names, Faces Primed to Make Big Bucks Off Tragedy
Bush's "crusade" against the Taliban of Afghan istan has more to do with control of the immense oil and gas resources of the
Caspian Basin than it does with "rooting out terrorism."
Once again an American president from the Bush family is leading Americans down an oil-rich Mid dle Eastern warpath against
"enemies of freedom and democracy."
President George W. Bush, whose family is well connected to oil and energy companies, has called for an international
crusade against Islamic terrorists, who he says hate Americans simply because they are "the brightest beacon of freedom"
and a democracy.
The focus on religion-based terrorism serves to conceal important aspects of the Central Asian conflict. President Bush's noble
rhetoric about fighting for justice and democracy is masking a less noble struggle for control of an estimated $5 trillion of oil
and gas resources from the Caspian Basin.
One of the material results of the elder Bush's Desert Storm campaign in 1991 was to secure access to the huge Rumaila oil
field of southern Iraq, which was accomplished by expanding the boundaries of Kuwait after the war. This allowed Kuwait, a
former British protectorate where American and British oil companies are heavily invested, to double its prewar oil output.
The Trepca mine complex in Kosovo, one of the richest mines in Europe, was seized last year by front companies for George
Soros and Bernard Kouchner, two members of the New World Order gang who devastated Serbia.
A similar geopolitical strategy, influenced by Zionist planners, to control the valuable mineral resources of the Caspian Basin
underlies the planned aggression against Afghanistan, a Central Asian nation that occupies a strategic position sandwiched
between the Middle East, Central Asia and the Indian subcontinent.
Central Asia has enormous quantities of undeveloped oil resources including 6.6 trillion cubic meters of natural gas, waiting to
be exploited.
The former Soviet republics of Uzbekistan and Turkmenistan are the two major gas producers in Central Asia.
Today, the only existing export routes from the area lead through Russia. Investors in Caspian oil and gas are interested in
building alternative pipelines to Turkey and Europe, and especially to the rapidly growing Asian markets.
India, Iran, Russia and Israel are working on a plan to supply oil and gas to south and southeast Asia through India but
instability in Afghanistan is posing a great threat to this effort.
Afghanistan lies squarely between Turkmenistan, home to the world's third-largest natural gas reserves, and the lucrative
markets of the Indian subcontinent, China and Japan. A memorandum of understanding has been signed to build a 900-mile
natural gas pipeline from Turkmenistan to Pakistan via Afghanistan, but the ongoing civil war and absence of a stable
government in Afghanistan have delayed the project.
Afghanistan was at the center of the so-called "Great Game" in the 19th century when Imperial Russia and the British Empire
in India vied for influence. Today, its geographical position as a potential route for oil and natural gas pipelines makes
Afghanistan extremely important to energy magnates seeking control of these precious resources.
Enron, a Texas-based gas and energy company, to gether with Amoco, British Petroleum, Chevron, Exxon, Mobil
and Unocal are all engaged in a multi-billion dollar frenzy to extract the reserves of Azerbaijan, Kazakh stan, and
Turkmenistan, the three newly independent Soviet republics that border on the Caspian Sea.
On behalf of the oil companies, an array of former cabinet members from the elder Bush administration have been
actively involved in negotiations with the former Soviet republics. The dealmakers include James Baker, Brent
Scowcroft, John Sununu and, notably, Dick Cheney, now vice president.
Turkmenistan and Azerbaijan are also closely allied with Israeli commercial interests and Israeli military intelligence.
In Turkmenistan, a "former" Israeli intelligence agent, Yosef A. Maiman, president of Merhav Group of Israel, is the official
negotiator and policy maker responsible for developing the energy resources of Turkmen istan.
"This is the Great Game all over," Maiman told The Wall Street Journal about his role in furthering the "geopolitical goals of
both the U.S. and Israel" in Central Asia.
"We are doing what U.S. and Israeli policy could not achieve-controlling the transport route is controlling the product," he said.
"Those who control the oil routes out of Central Asia will impact all future direction and quantities of flow and the
distribution of revenues from new production," said energy expert James Dorian in Oil & Gas Journal on Sept.10.
Foreign business in Turkmenistan is dominated by Maiman's Merhav Group, according to The Washington Report on Middle
East Affairs (WRMEA).
Maiman, who was made a citizen of Turkmenistan by presidential decree, serves as Turkmenistan's "official negotiator" for its
gas pipeline, special ambassador, and "right-hand man" for the "authoritarian" President Saparmurad Atayevich Niyazov, a
former Politburo member of the Central Committee of the Communist Party of the Soviet Union.
The Merhav Group of Israel officially represents the Turkmen government and has brokered all of the energy projects in
Turkmenistan, contracts worth many billions of dollars.
Merhav has been contracted to modernize existing natural gas infrastructure and will build new facilities in an oil refinery in the
city of Turkmenbashi on the Caspian Sea. Merhav refuses to disclose its sources of financing.
In keeping with Israeli political interests, Maiman's planned pipelines bypass Iran and Russia. Maiman has said that he would
have no objection to dealing with Iran, "when and if Israeli policy allows it."
Iran has accused the United States of trying to keep regional pipelines from passing through Iran. Creating a counterbalance to
Iran's regional influence was a cornerstone of the Clinton administration, which was concerned that Iran could gain too much
control over Caspian ex-ports.
"This is a common interest for the U.S. and Israel," said Dr. Nimrod Novik, vice president of Merhav. "The primary interest is to
prevent the development of Turkish strategic dependence on Iran, given the unique emerging strategic relationship between
Turkey and Israel."
Russia and Turkmenistan are in a battle to conquer the Turkish gas market, and the supplier that offers the best price will
emerge as the winner.
"This is a great race," Maiman says, "Whoever takes Turkey first wins. Whoever comes second will have lean years."
Although the United States needs Russian assistance in its campaign against Afghanistan, when AFP asked Alex Chorine of
Caspian Investor what kind of relationship existed between the Russian and Western/Israeli energy companies doing business
in the Caspian Basin, Chorine said, "They act as enemies."
One of Maiman's proposed pipelines would bring Turk menistan's gas and oil to Turkey via Azerbaijan and Georgia.
Maiman's Merhav Group is also involved in a $100 million project that would reduce the flow of water to Iraq by diverting water
from the Tigris and Euphrates rivers to southeastern Turkey.
Israeli officials boast of having "excellent relations" with Azerbaijan, where an Israeli company, Magal Secur ity Systems, has a
contract to provide security at Baku airport. Magal is one of several Israeli companies that will "turn Israel into a major player in
Azer baijan" by providing security for the 1,200 mile pipe line taking oil from the Caspian to the Turkish port of Ceyhan on the
Me diter ranean Sea.
Enron, the biggest contributor to the Bush campaign of 2000, conducted the feasibility study for a $2.5 billion
trans-Caspian gas pipeline, which is being built under a joint venture agreement signed in February 1999 be tween
Turkmenistan and two American companies, Bechtel and General Electric Capital Services.
Maiman acted as the intermediary between the Turkmenis and the U.S. firms, but won't discuss "his cut" or whether he will
receive a stake in the pipe line.
The Merhav Group has hired the Wash ington lobbying firm Cassidy & Asso ciates and spent several million dollars to "en
courage" U.S. officials to push for the trans-Caspian pipeline.
CRITICAL FOR WHOM?
During the Clinton administration, Secretary of Energy Bill Richardson and "special adviser to the president" Ri chard
Morningstar promoted the Baku-Ceyhan pipeline, calling it "critical to the economic survival of Turkmenistan."
The relationship between Israel, Tur key and the United States. is the major factor for the selection of the Baku-Ceyhan route,
which could be extended to bring oil directly to energy-deficient Israel.
Energy experts, however, question the wisdom and expense of this route. Com panies are under pressure from the United
States and Israel to invest in east-west pipelines, although most companies would pre fer cheaper north-south pipe lines
through Iranian territory, according to WRMEA.
The U.S. firm Unocal was leading a pipeline project to bring Turkmenistan's abundant natural gas through Afghan istan to the
growing markets of Pakistan and India,until the turmoil in Afghan istan led them to withdraw from the project in 1998.
The planned pipeline would carry gas from the Turkmen Dauletabad fields, among the world's largest, to Multan in Pa kistan,
with a planned extension to In dia. The line from Dauletabad through Afghanistan is planned to transport 15 billion cubic feet of
gas per year for 30 years. This pipeline is on hold until the political and military situations in Af ghan istan improve.
There is a second Unocal project to build a 1,030-mile oil pipeline called the Central Asian Oil Pipeline Project, which would
start at Chardzhou in Turkmen istan linking Rus sia's Siberian oil field pipelines to Pakistan's Arabian coast. This line could
transport 1 million barrels a day of oil from other areas of the former Soviet Union. It would run parallel to the gas line route
through Af ghanistan and branch off in Pakistan to the Indian Ocean terminal in Ras Malan.
Before the sun set on the apocalyptic day that New York's gleaming twin towers collapsed, the U.S. government had al ready
decided to blame the attack on Osama bin Laden, the Saudi-born guerrilla leader, and the Tali ban government of Afghanistan
which harbored him.
Although the U.S. government did not present evidence in support of its case against bin Laden, Secretary of State Colin
Powell said on Sept. 23, "I think in the near future, we will be able to put out a paper, a document, that will describe quite
clearly the evidence that we have linking him to this attack."
When it was reported that the Taliban might turn bin Laden over to face justice, the Bush administration said that surrendering
bin Laden would not prevent an American-led attack on Afghanistan.
An international plan to remove the fundamentalist Islamic Taliban from pow er has been a subject of international diplomatic
discussions for months and was reportedly raised by India during the Group of Eight summit in July in Genoa, Italy.
The Indian press reported in June that, "India and Iran will 'facilitate' U.S. and Russian plans for 'limited military action' against
the Taliban if the contemplated tough new economic sanctions don't bend Afghanistan's fundamentalist regime."
The invasion plans described in the Indian press in June may come to pass in October: "Tajikistan and Uzbekistan will lead the
ground attack with a strong military back up of the U.S. and Russia. Vital Taliban installations and military assets will be
targeted."
The economic reasons for the multi-national assault against the Taliban were explained: "Uzbekistan, Tajik is tan, Ka zakh
stan, and Turkmenistan are threatened by the Taliban that is aiming to control their vast oil, gas, and other re sources by
bringing Islamic fundamentalists into power."
Source: American Free Press
ORO
(11/8/01; 11:07:25MT - usagold.com msg#: 64945)
SteveH - fiat is fiat unless it is gold
I have contended that there is an undeclared gold standard of sorts, tied with gold and perhaps other commodities like oil. That the Fed has attempted to maintain a par of the dollar to the gold and whatever other items might be in the basket.
If this were declared, say that one dollar is a basket of 2 grams of silver, 1/100 gram of gold, 1 oz of crude oil, a briquette of coal and 1/200 of a gram of Palladium, then the expected result of successful maintenance of par would be that the basket would remain at the constant price of one dollar.
If it were a pure gold standard, then the Fed's job would be to maintain the price of gold at a constant level. If it were a golden treasury standard, i.e. that the Treasury's bonds be exchangeable for a fixed amount of gold upon maturity, then the Fed's job would be to maintain this price by adjusting the treasury price through its monetary operations.
Under any of these circumstances would one dare raise the question of manipulation?
Is the definition of a dollar as the equivalent of a particular basket of goods or through the pegging of treasuries to a basket of goods a manipulation?
I would say that if the pegging were accomplished by artificial supply of the commodities themselves or with an artificial supply of futures and options then one could argue there is a manipulation. If it is solely accomplished by free market actors doing whatever they did in their own private dealings, and the Fed simply adjusted rates and monetary base, then what harm is there?
ge
(11/8/01; 10:49:35MT - usagold.com msg#: 64944)
ORO
As you say;
<The "wealth barter gold" really took the cake. It was money in all but name, but if you called it by that name it would be because you were a "hard money socialist" >.
Completely agree with that.
However, I cannot not get excited about dollar's future due to the existence of dollar demand of foreign debt, because the debt seems to be unsustainable (i.e. rate of growth of debt [interest rates] is greater than the rate of growth of the real economy). The quality of the debt is the problem.
Hyman Minsky has fashioned the following taxonomy of debt:
1. "Hedge finance", where a firm borrows against a relatively assured cash flow;
2. "Speculative finance", that is not covered by visible receipts and where a firm has to rely on renewing old debts;
3. "Ponzi finance", where there is no cash flow and debt has to expand exponentially to avoid bankruptcy.
Most of the emerging markets' debt is either speculative or Ponzi type. Global recession would make things worse. During the Kondratieff winter, debt defaults are the norm. In such an environment, demand due to debt could evaporate…
Hipplebeck
(11/8/01; 10:37:06MT - usagold.com msg#: 64943)
A few simple things
The dollar is high because people in the world still think it is as good as gold. That perception will change.
Gold will go up when inflation comes. Inflation is coming. It is either that or US bankruptsy. Which do you think they will choose? They may have to write us all a check for thousands, but they will do that before they let the US go under.
Bankers are in big trouble. Relax and enjoy the fact that they are sweating bad right now.
I bask in the yellow glow. I enjoy watching them try to figure out how to make my investments worth more.
jb
(11/8/01; 10:26:12MT - usagold.com msg#: 64942)
gold down .
$4.00 and the very rich get richer.i agree with pandagold she has been the more accurate in the assessments on gold the the usa.
alot of talk here but why are people not the money buying ,if au and ag is so cheap. silver supply down to months and we are close to $4.00.fundamentals are fine but if you do not have the $$$of the rothschilds then stick to tech analysis,you will have more sustaining power.t.a. wins EVERYTIME.most people do not understand t.a.so they kick it around.
three ,four years ago the fundamentalists where out in full force touting gold and silver .here we are ,prices are lower, most of those people are long gone and we will be next if we are not careful.
Cavan Man
(11/8/01; 10:23:04MT - usagold.com msg#: 64941)
Hi ORO
I'm not too bright but I have this nagging, fundamental misgiving about US monetary and fiscal policy. I feel the same way about all of the debt in this country held by consumers, businesses and, not least of all, government. I am also awestruck by the enormous trade deficit this country runs (good for US!). I see no reason for the rally in equities at this moment nor the USD. My friend, the world is upside down and something is definitely not Kosher. What I am looking for are plausible explanations for the surreal. Will I find them?
dragonfly
(11/8/01; 10:21:07MT - usagold.com msg#: 64940)
A Voice in the Wilderness
http://www.whatreallyhappened.com/
Courage my friends, that really is what counts.
Read the top link on the Fourth Reich.
The propaganda fog on this war makes the gold fraud of recent years look like no big deal.
Old Yeller
(11/08/01; 10:15:40MT - usagold.com msg#: 64939)
ORO; Asian market forces
That is absolutely fascinating cause and effect.Thanks so much for your thoughts on this.Always seems in these situations that at the core there is some entrenched power trying to manage solutions to their advantage.The long term ramifications of such tinkering are truly mind-boggling.
This is a big piece of the puzzle,thanks again.
Off to ponder
ORO
(11/08/01; 10:13:52MT - usagold.com msg#: 64938)
Cavan Man - one more item
The actual timing of my turnaround as to the likelyhood of the euro taking a reserve role of some substance was during the ECB's rate hikes in 2000. That is when I realized that the ECB was not willing to inflate enough to create a debt trap, or that the debt trap on foreigners was not what formed as a result of low ECB rates.
My first supposition was that the ECB's inflation of the euro money supply was simply too small and too slow, but a short study of the ECB's "achievements" on this end came up with the simple observation that the only substantial lenders in euro were banks, meaning that normal people with their heads screwed right did not want euro denominated paper, thus the ECB's monetary inflation was concentrated solely at the monetary base level - i.e. the purest of inflations, associated mostly with bail-out activity rather than economically justified lending.
Soon after I posted that the ECB is not doing anything that would bring it to where it wants to go. I said that it is "chicken". That it is unwilling to do what is necessary to form a strong fiat debt currency: a global debt trap. A debt trap requires two stages, a massive inflation followed by a monetary contraction. I then said that the ECB was afraid of its own shadow and was unwilling to suffer the consequences of the actions that would lead it to its goal.
Then I realized that if the ECB did inflate at a rate at which the "debt trap" goal would be reached, the euro would be a laughing stock as waves of it would flood the market.
Then I looked at the composition of bank and bond lending in the global debt markets after the initial euro debt expansion of 1999 and found that the dollar was not displaced proportionately in the floating value global debt markets but for purchases of euro denominated bonds by EMU banks. Meaning that euro bond issues did not have a strong market. Only EMU banks and insurance companies were willing to hold large amounts of euro denominated paper. And that was so because they were part of the euro system itself.
Later, I found out that there was an enormous bank led move into euro assets funded by borrowing in other currencies, predominantly yen and international dollars, and that the EMU already had a negative income flow as a result. It's preliminary success in attracting investment before the euro launch (e.g. $1 trillion in 1997-8 alone) caused a crowded trade.
The question then arose if they knew what they were doing. I came to the conclusion that they did not. Henceforward I called Wim Duesenburg "Dim Wim".
ROSEBUD99
(11/08/01; 10:11:04MT - usagold.com msg#: 64937)
RE:ORO POSTS
Thanks for your posts yesterday and today, lots to study and ponder. BTW so what is your thoughts on gold for the future??? When ever you have time. Thanks.
SteveH
(11/08/01; 10:07:59MT - usagold.com msg#: 64936)
ORO
Also, isn't it too fraud for the Fed and Treasury to trade or cause to trade or to facililitate trade in a commodity for the sole purpose of containing its price due to a loss of control causing a much vaster problem, all while denying and/or causing to be denied that gold isn't relevant in internation financial circles?
What are our options as a country with our money and our future best course of action to maintain the status quo but allow other countries to have what we have too?
SteveH
(11/08/01; 10:04:50MT - usagold.com msg#: 64935)
ORO
So, gold is not going to rise anytime soon? The Euro is not a replacement currency for a dollar on its final legs, because it isn't on its final legs? The use of the dollar as a reserve currency in the purchase of oil (and gold) will not occur?
Where do we stand, man? Is there hope and why all the domestic attacks then if not knock us down a notch?
Gandalf the White
(11/08/01; 09:58:27MT - usagold.com msg#: 64934)
RUN SPOT, RUN !!! ----PAPER AVALANCHE !!!!!
The Hobbits are going to get some more of this "cheap" YELLOW !! HELLO Denver ?
<;-)
Galearis
(11/08/01; 09:54:51MT - usagold.com msg#: 64933)
@Netking
the Saudi unrest situation
If it weren't for the wealth situation of the royals here one could almost feel sorry for their situation. Much of the population is quite anti-US, of course, and the royals would have a most ambiguous private attitude as well. The Saudi Arabia could be looked upon as an occupied country and one that is maintained solely by US (oil) interests. However, probably the more accurate way of looking at their situation is of a protectorate/puppet state. The royals would be dethrowned by their own Islamic fundamentalist population were it not for the presence of US military nearby.
G.
jb
(11/8/01; 09:26:13MT - usagold.com msg#: 64932)
gold price
getting kicked in the teeth right now.
BR549
(11/8/01; 08:56:27MT - usagold.com msg#: 64931)
GDP vs. Debt
Belgian (msg#: 64910)—
I agree that the world's economy perpetuates itself in a quagmire of increasing debt. The debt itself does nothing to hamper GDP except that interest payments hamper the bottom line profits. GDP is the positive production side of goods and services. An increase in GDP is healthy for all economies.
The problem with debt is that there is a corresponding cost associated with servicing and maintaining a given debt level. If a corporation could borrow an unlimited amount of money without increasing its cost of capital, all corporations would borrow to the lenders limits all of the capital that they could.
If you look at capitalism throughout history, capital is a scarce resource. There is never enough capital for expansion and incremental capital, if invested wisely, provides for additional production of goods and services. As interest rates increase, there is a corresponding rise in the external cost of capital (capital raised from borrowing or bond issuance, not equities) and a need to offset these liabilities with a higher rise in the rate of return resulting from the borrowed capital. Opportunity capital is the judgment of which endeavor in which to invest borrowed funds to maximize return. Therefore, it is not the debt that is significant to the private sector but the costs associated with the debt. Same with the public sector.
As with the private sector, the public sector also has an underlying cost for debt incurred. Your point about "*Increasing Total Debt, strangulates, declining total GDP*." has no relevance without the corresponding underlying cost associated with the debt incurred. Declining interest rates in the future will have a less dramatic effect on the liabilities side of their financial statements and vice versa.
The Fed has been financing the U.S. national debt service with the lower interest short term bonds since the early days of the clintonians. The lowering of interest rates by the Fed is for the ultimate benefit of the banksters but all holders of variable interest debt such as governments are also beneficieries. In the private sector advertisements concerning second mortgages on citizen's homes in order to lower credit card interest obligations has showed a 50 basis point decrease in Fed funds and a 12.5 basis point decrease in the rates charged by the blood suckers, thereby increasing their spread by the 37.5 basis points which is not passed on to the borrower. Similarly in the public sector, the benefits are not passed on to the taxpayers.
Therefore, the meaning of statistics-- To say that we need to decrease debt in the public sector says that the governments of all countries spend within their revenue inflows that they receive. We all know that Keynes buried that theory along with the responsibility of the politicians who implemented deficit spending and implemented vote buying.
So Belgian, no statistics, no meaning. If the ratio of GDP to debt interest payments is not relevant, then what is? If GDP growth doubles and debt service remains constant, then the public sector is way ahead in the short term. To say that all the debt that is being accumulated by all of the bureaucracies in all of the countries in the world is unhealthy, then I agree. But the only real meaning that it has is, if Belgium's GDP/Debt interest ratio is twice that of the rest of the world, then that is significant to the citizens of Belgium. And those statistics provide the information to those that are interested in doing something about it. Unfortunately, the usual solution in the public sector is to offload their irresponsibile increased debt spending on the taxpayer.
Thanks for your posts.
Regards,
BR549
uponroof
(11/8/01; 08:33:50MT - usagold.com msg#: 64930)
Oooops!
http://www.taipeitimes.com/news/2001/11/08/story/0000110619
still another.
uponroof
(11/8/01; 08:30:12MT - usagold.com msg#: 64929)
Thanks Grubstaker....
http://www.heritage.org/views/2001/ed110601.html
still another must read.
Spartacus
(11/8/01; 08:07:48MT - usagold.com msg#: 64928)
Operation Enduring Inflation
http://www.mises.com/fullstory.asp?control=820&FS=Operation+Enduring+Inflation
…Who pays and how? The first is easy to answer: you and I. The government spends no money that it does not take from the pockets of the people. Whether government is sending welfare to bums, paying off big businesses, or dropping bombs in strange lands, we are the only source of its spending. This is because government produces nothing on its own; even if you love the things government does, it is impossible to deny that it is a parasite on society…
---------
…The more interesting and complicated question is: where is the government going to get the money? ...
---------
…Now we move to the most likely scenario of all, the tried and true way in which government funds itself: inflation. I know that talking about inflation now is like warning of a bad winter in the middle of a hot summer. With the price of oil falling and interest rates being forced lower and lower, no one seems to think that there is any danger that general price increase will get out of hand…
Grubstaker
(11/8/01; 08:06:52MT - usagold.com msg#: 64927)
another "must read"
http://www.taipeitimes.com/news/2001/11/08/story/0000110619
so much for the "alternative view"....
ORO
(11/8/01; 07:52:41MT - usagold.com msg#: 64926)
Cavan Man - legions of problems - not just dollars
The main core problem post the 1986 reforms in the US tax system are a product of Japanese attempts at rescuing their political power structure, which revolves around the banks and the bum industrial companies they lent to without rhyme or reason at artificially low interest rates, and to their real-estate subsidiaries. They lend in dollars at near 0% and issue Yen exchange rate hedging instruments at unreal prices in order to back their yen liabilities. The dollars inflate foreign economies as they are invested outside Japan.
They inflated SE Asia in the 87-89 period, and again in 1995-7, then inflated Europe and inflated us along with China.
Contrary to FOA's claim that the euro is at the onset of a new "currency timeline" it is nothing but the successor to a group of prior currencies with enormous historical inflations built into them which were issued by heavily indebted governments that are seeking to increase their indebtedness and the rate of their deficit spending. The debts accumulated by the separate precursor currencies did not change as a result of the creation of the euro, they just got a new name.
In other words, the euro is as much a problem as the dollar. It is not a new animal but an old tired one with lots of baggage.
Cavan Man
(11/8/01; 07:26:30MT - usagold.com msg#: 64925)
PS: ORO
I do think the fundamental problems with the USD are legion.
Cavan Man
(11/8/01; 07:23:48MT - usagold.com msg#: 64924)
ORO
Thanks for discussion as you have fulfilled my hopes of drawing that out. I have taken in all sides of opinion for the last 30 months. Speaking as an investor and US citizen, I see very, very little opportunity for capital gains outside of investing in gold AT THIS POINT IN THE CYCLE all things considered. Many thanks.....CM
Black Blade
(11/8/01; 07:23:31MT - usagold.com msg#: 64923)
Jobless Claims Down in the Latest Week
http://biz.yahoo.com/rb/011108/business_economy_jobs_dc_2.html
Snippit:
WASHINGTON (Reuters) - Fewer Americans applied for first-time unemployment benefits last week, but the number of workers remaining jobless hit its highest level in more than 18 years, the government said on Thursday in a report showing weak labor conditions in a struggling economy.
The number of initial jobless claims fell by 46,000 to a seasonally adjusted 450,000 for the week ended Nov. 3, the Labor Department said. However, the number of workers staying on jobless benefits reached its highest level since April 23, 1983, when the economy was struggling out of recession. These so-called continued jobless claims rose by 34,000 to 3.72 million for the week ended Oct. 27, the most recent week for which the data were available, the department said. ``Folks who have lost their jobs are having a great difficulty finding new jobs. That's something we haven't seen since the last recession,'' said Mark Vitner, senior economist with Wachovia Securities in Charlotte, N.C.
``Many of the layoffs that we've been reading in the papers lately haven't even taken effect,'' he said.
Black Blade: The "Bone Pile" continues to grow higher. Just fewer applied for new benefits is all. The outlook still looks "GRIM."
Black Blade
(11/8/01; 07:12:52MT - usagold.com msg#: 64922)
Writing on the wall for stocks
http://cbs.marketwatch.com/news/story.asp?dist=dhtml&siteid=mktw&guid=%7B2FC3047A%2DEC60%2D4BB7%2D8081%2DB46890218056%7D
Investor sentiment, outflows point to trouble
Snippit:
Research firm Lipper Inc. says 93 percent of domestic mutual stock funds are in the red this year, providing further evidence that American investors are suffering their worst year in more than a decade. "I highly doubt there was any significant new money put to work in the past month or so," says Solin. "You still have a lot of people long tech stocks for instance, but not averaging down. The market has a wonderful ability to crush as many people as it can."
Indeed, there is little evidence that equity fund outflows have subsided, even during the rebound from the Sept. 11 terrorist attacks. "Investors have pulled money from stock funds during nine of the past 10 weeks," says Tim Villano of Aquila Advisors Inc., also in Connecticut. That outflow of money is bound to increase this month as investors send money to bond funds that have soared after the U.S. Treasury's decision to scrap new issues of the 30-year government bond.
The CBOE Volatility Index this week dropped below 30 for the first time since Sept. 5, suggesting that investors are on pain killers, accepting rising stock prices with goofy grins and drooping eyelids. "One sure sign we're still in a bubble is that every rally is into the pure crap," says Cliff Asness of AQR Capital in New York City. "People are still looking for lottery tickets, not investments. That's scary."
Black Blade: There's no argument here as it is true. There's no real news to trade on expect giddy expectations by some that we have seen the "Bottom" Bad news comes to light daily and yet the markets rally. Perhaps there is some speculation in the market indices and the markets by the president's Working Group on Financial Markets. This certainly would not be unprecedented. "Interesting Times"
ORO
(11/8/01; 07:09:37MT - usagold.com msg#: 64921)
Reply to comments - Cavan Man - non/agreement with FOA
Where I agree with FOA both now and in the past is that there is a political motivation for what FOA says. While in the past I thought this motivation was morally neutral, I found in the analysis of FOA and Another's later expressions that the mechanics of the program are composed of: (1) fraud by EU member CBs guaranteeing liquidity in the gold markets with no intention of following through. (2) an attempted involuntary erasure of dollar debts on the part of EMU governments, which pretty much amounts to intentional default, i.e. sheer theft. (3) What seems to be an intentional Japanese style artificial inflation of the value of the ECB member's gold stock by intentioal creation of a "gold bubble".
Particularly worrying was the net effect on Europe rather than the US: it was going to result in complete destruction of Europe's industry if it were carried out appropriately (i.e. maintaining some sort of par for the euro in terms of gold). If no redemption in gold and no par were set, then the "gold bubble" would destroy the euro because nobody would care how much gold the ECB had if the ECB were unwilling to sell any of it at a given price. It ends up being an accounting gimmick rather than a girder in a strong monetary system.
Upon understanding this, I figured that the financially weak party was the EU. Debt supply demand studies showed that the Fed was maintaining a rather tight supply demand balance for the dollar at home for most of Greenspan's tenure.
Further debt supply demand balance calculations revealed that it was during periods of credit expansion abroad - particularly in lending to developing markets by foreign banks - that the dollar supply demand balance was strongly positive and caused prices to rise in dollar terms and caused dollar exchange rates to fall. The US trade deficit seemed to grow not as a result of the US pushing dollars on an innocent and unsuspecting world, but as a reaction for the deflationary demand for dollars to repay debt formed in the the Eurodollar markets abroad, particularly in London.
A study of the Japanese financial flows and interest rate policy revealed the cause for the past 15 years of financial bubbles, from about 1985-6 onwards was Japan's attempt to cover up the devestating wave of bad investments made in export industries, during and after the real-estate and stock bubbles that hid the industrial malinvestment bubble of the early-mid 80s, the BOJ proceeded to create a 1987-89 bubble in the emerging nations, and then another one in the 1995-7 period of BOJ interest rates near 0. I realized that the BOJ was trying to keep the banking system afloat by putting non-Japanese assets on the other side of Japanese bank's liabilities. And that doing so meant that it was bombing the world with hot money at non-market interest rates of 0%.
Finally, when FOA started putting forward his economic theories, I realized that he had spent too much time listening to an Islamic cleric who had not a clue as to economics. The more he explained, the less reason there was to believe anything he said on economics, and better reason to doubt the competence of the assorted politicos making up the "political will". They started appearing to my mind's eye as a dozen little "sorcerer's apprentices" waiting to try out new spells they did not understand - but having convinced each other through posturing and victimization theory that they were right, were about to both set the house on fire while flooding the basement, leaving them nowhere to go for survival. At that point I posted my "warning".
Further suggestions of the supremacy of barter made me doubt the sanity of the "perfect logicians" of the central banking circles he refers too, and the standing of monetary history upside down in an attempt to justify the idea he implies: that investment does not and never did exist and all "paper" (which is the only way to do the bookeeping of investments) will burn because it is all fraud.
The "wealth barter gold" really took the cake. It was money in all but name, but if you called it by that name it would be because you were a "hard money socialist".
Finally, the total lack of causal mechanics within his never-never land of economic fallacy finally came to full expression with the assertion that "political will" would "trump" economic theory.
So, from my vantage point of budding economist, FOA's explanations come down to being non-arguments and economic gibberish that would even shame Marx and Keynes. From the political perspective, he reveals a monetary power struggle without moral or economic merit on any of the sides, the more responsible side seeming to be the US "dollar empire", so far as any economic reality is concerned, and the wild card is Japan. The Oil-Euro block scheme was thus revealed as simply an attempt to destroy the US and Asian economies on the one hand, and erase their own debts without calling themselves dead-beats. The motives of these people complaining of US defaults and monetary imperialism are simple: the greed for the unearned, envy grown of a zero sum view of social life that is characteristic of feudal societies such as Arabs still live in and Europe has barely made one step out of, and fear of their economic and financial future as a result of their stealing and wasting of their people's wealth.
dragonfly
(11/8/01; 06:25:02MT - usagold.com msg#: 64920)
Serious Consequences
http://www.alternet.org/story.html?StoryID=11855
A Must Read for all.
Cavan Man
(11/8/01; 06:13:35MT - usagold.com msg#: 64919)
I Rates
European Central Bank, Bank of England Lower Rates
(Update1)
By Christian Baumgaertel
Frankfurt, Nov. 8 (Bloomberg) -- The European Central Bank and the Bank of
England cut their benchmark interest rates by a half point each in a bid to
prevent a shrinking U.S. economy from dragging Europe into recession.
The ECB lowered its rate to 3.25 percent, the fourth reduction this year and only
the fifth since the bank took control of rates for the countries that share the euro
in 1999. The U.K. central bank pared its rate to 4 percent.
The U.S. economy, destination of 14 percent of Europe's exports, contracted last
quarter for the first time in eight years, and the Federal Reserve has cut 10 times
this year.
European policy makers should ``cut rates until they approach the U.S. levels,''
said Klaus Ridder, chief financial officer of Stinnes AG, a German company that
transports goods for manufacturers such as Royal Philips Electronics NV. ``Our
business worldwide was hit hard in September.''
The Fed trimmed rates by a half point on Tuesday to 2 percent, the lowest since
1961. The Bank of England has cut borrowing costs seven times this year, taking
rates to their lowest since February 1964.
ECB President Wim Duisenberg will have a press conference at 2:30 p.m.,
Frankfurt time.
Rising Unemployment
Yields on interest-rate futures contracts plunged, suggesting investors see more
reductions in coming months. The yield on the March Euribor contract fell 6
basis points to 2.75 percent. The U.K. contract due the same month yielded 3.63
percent, down 17 basis points.
Europe's economy is at ``a virtual standstill,'' the International Monetary Fund
said this week. The dozen nations that share the euro grew 0.1 percent in the
second quarter. Germany, the region's largest economy, didn't grow at all.
German unemployment had the biggest rise in almost three years in October and
business confidence posted the biggest drop in almost three decades. French
jobless lines grew for a fifth straight month in September.
British manufacturers were more pessimistic than at any time in more than three
years in October. Consumer spending -- 60 percent of gross domestic product --
has kept the economy expanding. Even so, home prices fell for the first time in a
year in October, Halifax Group Plc said.
European companies this year have said they plan more than 420,000 jobs cuts,
according to data compiled by Bloomberg News. That doesn't include 1,400
layoffs at Irish crystal maker Waterford Wedgwood and 13,000 jobs at risk at
Sabena SA after Belgium's state-owned airline declared bankruptcy Wednesday.
`Verge of Recession'
Airbus SAS on Monday pared its production forecast for 2002 by a quarter.
Usinor SA, Europe's No. 1 steelmaker, said it will reduce production by 10
percent in the second half of the year amid slowing demand.
``We've seen a lot of CVs from people who are looking for work,'' said Simon
Urquhart, managing director at Computalabel International Ltd., a software
company in Leicester, England. ``In the last four to six months, applications have
probably expanded 25 to 30 percent.''
The Dow Jones Europe Stoxx 50 Index is down 20 percent this year.
``The European economy is on the verge of a recession, if not already in it,'' said
Julian Callow, chief continental European economist at Credit Suisse First
Boston. ``Price data show a further decline in inflation.''
Slowing Inflation
The inflation rate in the 12 euro countries slowed for the fifth month in October, to
2.4 percent, compared with 2.5 percent in September. German inflation fell to 2
percent for the first time in a year, final numbers showed today.
Inflation has exceeded the ECB's 2 percent-limit for 17 months and the central
bank has cited rising prices as a reason for not lowering interest rates more
aggressively. Unlike the Fed, which also has a mandate to boost employment,
the ECB's chief aim is to combat inflation.
``There is no inflation danger,'' said Franco Mambretti, chief executive officer of
German machine tool maker Walter AG. A rate cut ``can only support investment
and consumption.''
ORO
(11/8/01; 05:57:00MT - usagold.com msg#: 64918)
Reply to Comments - Mr Gresham totals
The Debt supply demand would include net growth in dollar debt as supply at about $60 billion (so small because dollar debt is still contracting in Japan and developing nations), and interest due as demand. Interest due totals $430-480 billion with the EU debt repayment demand range.
The sums are not allways additive. The net supply demand balance means default when it is negative - dead debt. While it is cumulative on the debt creation side.
Though "theoretically" the overall balance should come out 0 once trade balances and investment balances are added in, it does not quite work that way because part of the investment balance is a result of demand for future dollar supply from US investments and is a result of a negative supply demand balance. Similarly, when the supply demand balance is positive, the net outflow from US assets in the investment flows accounts is part of the phenomenon resulting from reduced dollar demand. When analyzing this balance for the purpose of determining pushing and pulling on exchange rates, then I calculate it both with and without the investment figures from the equation. The core figure, however, is the debt supply demand balance.
As to your question as to what reverses these conditions of strength, it would be a revival of dollar debt funded developing market investments, particularly from abroad.
Thus, a sudden renewed boom in foreign dollar debt funded investment in the Tigers and China would completely whack the dollar if a US slow down does not help in reducing the trade deficit quickly.
Another one would be a last minute reversal of the euro introduction.
ORO
(11/8/01; 05:25:55MT - usagold.com msg#: 64917)
Reply to comments - Canuck
Since the euro/USD rate is subject to the policy decisions of both governments and central banks in the EMU, Japan, and the US, I would have to predict what they will do in order to predict these rates, as well as predicting whether any further "all paper will burn" kinds of attacks are coming. What remains outside their powers (at least for now), namely the relative debt positions for the two currencies that make up much of what dictates the exchange rate, and investment flows that go from the regulated system to the less regulated one, means that till the EU moves tax/reg costs downwards and/or the US moves them upwards, flows would continue at the present pattern and join with negative EMU investment income balance to cause a continued drop in euro/USD, now being maintained by an artificial carry trade between artificially low USD rates and artificially high euro rates.
The liquidation of USD debt in EMU is proceeding slowly, and eating away at the reserves. Meanwhile, the euro debt inflation of 98-00 may be released into the pricing system by defaults of euro debt if the ECB maintains rates this high much longer without tax and regulatory lightening by the EU.
The thing to remember when thinking of tax and regulatory costs is that the product provided by government in return for taxes is near 0 in value and because it eats up resources that could have been used by individuals taxes are a double negative, as are regulations - which lower efficiencies while slowing business reaction times.
So if tax and regulatory burdens are say 50%, then the appropriate carrying capacity of financial assets in that jurisdiction would be 1/4 of the carrying capacity of a jurisdiction with none. That is because return after government burdens is diminished by 50% on the tax (including price inflation) and government borrowing side and by 50% again when the government consumes resources. Leaving a 25% net return on the same investment.
Thus when US gov tax and spend policies went from accounting for 23% of GDP in the early 60s to 32% in the early 1980s, the value of financial assets relative to GDP fell from 2.6 to 2.0. But with 20% capital gains taxes and partial sheltering of investment gains in tax sheltered retirement accounts, the result is an effective investment tax rate of near 20%, and a value of financial assets at 3.8 times GDP.
In the case of the ECB, if it sticks to broad targets of 4% monetary and financial asset growth while taxes and regulation are lowered, the result would be a large scale import of capital in direct investment, which denies Europeans ownership of the new enterprises. If the EU substantially increases government burdens, then the maintenance of 4% growth in monetary or financial assets would cause a major price inflation and a continued evacuation of European capital abroad.
Thus I can't really say what is going to happen to exchange rates if EU tax and regulatory policy changes. If things remain as they are, then the euro would have to drop down to below $0.80 in order to bring the trade balance in line with the negative income accounts after a $2.3 trillion increase in international bank lending to the EU since 1997, of which $1.6 trillion seems to have been one sided into EMU, with no counter-investment abroad, then the EMU needs to increase the trade surplus or decrease the net capital flight (say by decreasing taxes on investments down to below US levels) by $80 billion or so. Just keeping the euro rates up simply causes the carry trade on hot money to produce more euro into the world market supply.
nickel62
(11/8/01; 04:55:15MT - usagold.com msg#: 64916)
Read this Forbes article and ask yourself if this sounds like one of us here or a main line article in a business magazine.....
Bond Timers Bullish--Too Bullish?
Peter Brimelow, Forbes.com, 11.07.01, 10:28 AM ET
NEW YORK - Bond-timing letters made a dramatic move to the bullish side--their average exposure as tracked by Hulbert Financial Digest went from -38% Sept. 27 to a recent + 60%. Problem: Such extreme moves are usually wrong.
So, it makes sense to listen to some dissenters. Skeptics have been pondering the Treasury's killing of the 30-year bond. Their reactions are classic newsletter: (1) deriding official explanations and (2) conspiracy spotting.
Richard Russell in his Dow Theory Letters: "Greenspan literally sponsored the Great Bubble by feeding it all the ammunition it needed.... When the bubble burst he first misdiagnosed the danger, and when the danger became apparent he opened the floodgates, creating an ocean of money.... But the long bond wouldn't come down.... Bond buyers were (rightly or wrongly) afraid of future inflation.... What to do? Why that's easy--get rid of the rotten long bond.
"The way they ended the long bond was sort of disgusting. They didn't wait for the close, just announced it and drove the shorts to the wall. I heard that some Wall Street houses got the info early and made a killing.
"It's long been rumored that gold has been manipulated in order to hide the forces of inflation. I've been skeptical of that so-called manipulation, and I still am. But with the elimination of the long bond, I fear that evil has overtaken the authorities who run our nation."
Tony Sagami of Scientific Investing (no Web site--ironically!):
"A blatant attempt to manipulate the bond market.... The Treasury Department desperately wants to prop up the only part of the economy that hasn't totally fallen apart: the real estate market."
Harry Schultz of the International Harry Schultz Letter, writing in his trademark telegraphese:
"The US govt shot another dog, to stop it barking. Not satisfied with shooting the golden dog so it can't bark/warn of govt overspending & currency debasement, the US now blocked the messages from its 30-year bond, long a benchmark for economists. Wall Street has become a brothel."
These skeptics think interest rates have bottomed and will probably head up.
Canuck
(11/8/01; 04:40:58MT - usagold.com msg#: 64915)
Euro Countdown
54 days
Belgian
(11/8/01; 03:08:54MT - usagold.com msg#: 64914)
The National Bank of Belgium (NBB)
In the following story, we get another example, as to how, ordinarry citizens are considered by the collectivity.
The discussion is about the following :
The NBB is about to loose its exclusive printing/distribution, right, of fiat, within the community, due to the euro and shift of this emission-right to the ECB ! When the NBB looses this right, to the ECB, it has to distribute its reservefund, to the shareholders. Say 2.717 euro per share. Present value of NBB on Brussels exchange = 1.600 euro !
Minority, plublic shareholders are calling Deminor, to take up their defense. But the NBB governor (Guy Quaden) has already stated that ECB + national banks, will share the responsability and exclusive right for the euro-fiat-emissions ! And that's it. Forget, again, about honest national or central banks, towards the shrimps.
Whenever we find a key...they change the lock !
Pandagold
(11/8/01; 03:07:48MT - usagold.com msg#: 64913)
Blackblade 'Rumors persist.......................' (#64900)
Blackblade: I have copied and posted the key sections of your post #64900 below as this hits on the head a part of the 'agenda' pertaining to gold that is being effected at present.
Like Bush and Blair keep saying about Afghanistan, it is not something that can be achieved overnight - because there are too many inter-related considerations. ( Isn't there something about - turn up the heat of the water in the pot slowly and the frog doesn't jump out?) A rather loose analogy, but enough to get the point over.
<<<<Rumors persist that many major miners in copper, silver, and gold will be out of business or acquired within the next 5 or 6 years. These include Grupo Mexico, Phelps Dodge (PD), Barrick Gold (ABX), Newmont (NEM), and Placer Dome (PDG). Virtually all these companies have gutted their operations and are high-grading the ore without replacing reserves at many operations.......................
...............I saw much of this first hand and it does not surprise me that we could see many of these companies cease to exist in the not too distant future.................
). Many of these companies are backed into a corner and the only avenue left is to merge and acquire other miners on the cheap to satisfy old forward positions or to engage in new forward sales. As prices fall, there is little incentive to lock in to very low forward prices. Then the "House of Cards" falls in on itself. There is very little if any new exploration activity - this will eventually result in reduced supply and higher prices. - "Game Over" >>>>>>
Now, all those interested, go back to my post #64733 in which I included a run down on a certain 'illiustrious' family name in banking, and note in particular the closing paragraphs.
One point on which, from the many posts here, we are all agreed is that Gold is the only 'real' money. Apart from that it is a fairly finite commodity in its own right with singular qualities.
Can you now begin to get some idea of the grip on the world those that own and control most of it will (do) have. Yes, it could be (made to) sink a bit lower before any substantial rise, and, in my book, probably will.
I mean, why pay $270, if you can shake it out at $250. Then you have the objective to push some of these mines into 'surrender' that try to hang on in there, and a lower gold price will do just that. Many of them are hanging on by the skin of their teeth at the moment and if the price doesn't go higher, will be 'out' next year.
I used to struggle with understanding the cliché - 'the truth shall set you free'. It sounded very philosophic, but I kept saying to myself - 'free from what?'
Then, one day it dawned - 'Free from false illusions' (about what makes this world tick, and who winds the clock).
"He who has the gold makes the rules" Never, never, forget that ('They' don't)
ORO
(11/8/01; 02:27:26MT - usagold.com msg#: 64912)
Replies to Comments - Old Yeller
The problem of Asia's developing markets has been the problem of Japan. To demonstrate, let us take the ownership structure of the industrial conglomerates that did the work of the modernization of Japan from the Meiji onwards. The structure was essentially of a bank around which were industrial companies, the banks were centered around a central bank and a stock market. Access to bank lending was restricted to the industrial companies of each conglomerate. Access to the bond and stock market was restricted to the banks. The structure was copied from the diaries of British and French bankers that assumed a superiority of technical expertise among the people with the exclusive privilege of banking. These same technocrats were loyal to the founding families of the conglomerates and populated the government ministries designed to prevent competition among them and protect them from foreign competition.
At the low level, were tens of thousands of small manufacturers funding themselves through cash flow and by borrowing from underworld loan sharks. The latter were, of course, unprotected by privilege and thus remained both solvent and without the need for occasional restructuring of the debts. Thus the Yakuza became the more stable portion of the Japanese financial system and their power grew to the point where they had infiltrated the upper strata of all of Japanese institutions.
Most of the time, the Japanese system did not take on much foreign debt and allowed very little foreign direct investment. Banks within each conglomerate were required to lend to all subsidiary organizations without prejudice (i.e. without regard to risk and credit quality) and without limit so long as the books balanced. Because of mark to market regimes, the banks could lend to real estate operators and buy stock, thus pushing prices of both to rather absurd heights. The stock issuers, namely the other conglomerate members, were able to "focus on the long run" and fight for global market share, while a primitive and over-regulated retailing system meant that local consumer prices were persistently higher in Japan for the same products available abroad and each car sold abroad at a loss could be have the loss covered by hiking local prices. Toyota, Subaru, and Honda, being (for the most part) outsiders to the conglomerate families that ran Japan managed to do best abroad, which brought them strengths at home once the labor force got stretched and competition for labor got started. The age differences among workers in the successful and less successful companies quickly showed up over the 80s and brought the lesser companies near ruin, where US companies GM and Ford, oddly enough, are trying to save them.
Growth of Japanese industry was extremely focused on "strategic" goals and had benefited from a number of US government blunders, most notably the anti-trust case against the RCA transistor patents, which made licensing the technology to Japanese electronics producers preferable to doing the same in the US, which was pretty much impossible till all the legalities were done with - by which time Japan was ready with overwhelming production capacity. The second item was the auto industry, encrusted with barnacles and dust from decades of near immobility, protected from competition by a network of state gov. protected dealerships and by collusive practices that led to such ideas as "planned obsolescence" to force people to buy a new car 3-5 years after purchase.
The old French banker's schemes satirized in "The Protocols" were applied within Japan for the benefit of the families that ruled Japan. With exclusive reign on fiat debt money banking, they could out-finance any local competitor and overwhelm him by selling competing products at a loss till the competitor keeled over and closed, and his operations taken over by a crony. The crony capitalists could hide the losses in a veritable flood of loans from the banks, thus distributing losses to small Japanese savers who could have financed successful competitors to them.
The motive for Japan's industrial development was maintenance of the strength of the ruling class. The goal was power against the West so that Japan would not suffer the de-facto dismemberment that China went through during the late 19th century and earlier 20th. Thus it became the local imperative to prevent foreign ownership of Japanese industry. Not because the Western companies were particularly colonial (which they were), "bad" for the people's welfare, or somehow malicious, but because they were not the current ruling class, and were a challenge to the traditional feudal power structure and the ruling families at its top. Economic development was taken as simply a tool of power, as opposed to the Western attitude of power being a tool of economic interests.
This is the heritage left to Asia as it followed in the footsteps of Japan, a ready made route with predefined steps, with little risk and practically no innovation. The purpose of which was simply to provide economic development which would keep the ruling elite in its place and improve its lot. The same opportunity for profit from employing a near Neolithic workforce in 20th century industry was obviously seen by many.
The choices facing a subsistence culture seeking development are few. In order to obtain the equipment and expertise they need in order to develop economically, they need to either borrow abroad with little or no collateral, or allow foreigners to build foreign owned plants. Borrowing abroad with no collateral is very expensive. But without this, ownership of much of industry would be foreign until local savings are sufficient to buy off the foreign owners. The result is that the cronies of government make deals which allow minority ownership by investors, and saddle companies with debt to finance the rest. Thus cronies obtain equipment and technical expertise from abroad with no capital of their own, while maintaining majority ownerships of enterprises. Furthermore, they use government power to prevent unionization, to prevent other foreigners from entering, and to close down competitors. They also use banks to funnel the public's savings exclusively into their hands.
Of course, the cronies, lacking in merit, eventually run much of the new industry into the ground and bring the debt into default. At this time, the foreign investors exchange some debt for equity, the local currency falls in order to lower the price of local production abroad, and the economy re-stabilizes with minority ownership by the cronies, or their complete removal. The alternative is to let the debt default, and have an end to foreign (and domestic) investment, freezing the country in place.
What Rubin did in his "strong arming" tactics was actually a positive. It prevented the Asian crisis from becoming worse. It allowed the exchange of debt with equity and allowed changed ownership from failed local cronies to more successful locals or successful foreigners. It prevented the economies from total collapse of incoming investment flows. This was achieved in places like Korea, but not in Indonesia, where capital investment froze because debts were not converted into equity and control remained within the broad crony network. Thus recovery of loans was prevented, and foreign investors fled, with no intention of ever returning.
The dollar reserves of the Asian countries, even those who have become net creditors, do not allow them complete repayment because the loans, at 12-20% interest, are owed by companies that are still distressed, not the ones that are accumulating dollars at a 5-6% return. Thus the only choice for the debtors is repay debt or lose control by partial or complete sale to local companies with cash or to foreign firms. Thus the reserves are only good when the owners of the indebted corporations are willing to sell them in part or in whole. Which they very much don't.
This happened in Japan too. Everyone there was over-invested, and returns neared 0 because all export business opportunities were filled, while government could not remove the buffer that provided the last bit of profit for corporations by opening consumer markets to competition for fear of pushing the rest of industry and the banks into bankruptcy. They also need to keep the Yen weak enough to allow continued export of the product of their "excess" capacity, and prevent consumers from buying foreign goods so that ownership of industry and banking does not change hands from LDP cronies to others, as it would if local consumers were not fleeced by producers on the one hand, and their labor expropriated by an artificially low yen value.
The result of this kind of policy is to cause consumers to save more than they otherwise would because of the high prices, and for these savings to seek a way out of the country where returns are more than "slightly above zero". Thus Japanese save at astonishing rates, and the savings constantly leave the country. This condition is also apparent in China where government subsidies of exports have caused over pricing of products locally, thus driving up the savings and causing their export abroad.
So to the final question, releasing reserves would not crash the currency, it would crash the distressed companies and bring the crony owners to a loss of ownership while endangering future foreign investment if the governments do not allow the bankruptcy liquidation to proceed.
In this case, across Asia, the choices are (1) continue the misery and retain control by failed local cronies at th ecost of 20% interest rates and holding matching reserves earning 6%, (2) liquidate the failed cronies and change the balance of power in the society, or (3) face the possibility of ending foreign investment till a new regime comes along, a far worse misery.
Netking
(11/8/01; 02:27:13MT - usagold.com msg#: 64911)
Belgian
Yes Sir, as somebody once said to me; "I don't know how some of those cycles work, but they jolly well do!"
At the time we are in the heat of the battle it's hard to pick absolute bottom, but easy with the old 20-20 hindsite in place(grin). Having said that I believe we are right that end of 2001 into 2002 is golds time to awaken in earnest and the cycles/charts confirm this to us for sure.
PS: Belgian, was it your airline in the news a few days back, if so will it survive if they undertake a restructure? We've just "been there and done that" for ours too.
- Netking
Belgian
(11/8/01; 02:05:13MT - usagold.com msg#: 64910)
@ BR549 # 64876
Let us not waste time and energy in investigating all those endless statistics, and just look at the fundamentals.
*Increasing Total Debt, strangulates, declining total GDP*.
120% debt to GDP for Japan (and Belgium as well)! And knowing that a lot of hidden debt, has not been taken into account. US debt 6 trillion against 10 trillion GDP ? Hidden reality is far more worse than percepted. Impossible
to define *all* debt (or service-volume) against the global 40 trillion world GDP. It just keeps on detoriating, faster.
Interest rates are reaching a 40 years record low. Much too little, much too late ! What do we need statistics for ?
Thanks for replying.
Waverider, thanks for joining.
Netking : The 8 year cyclic bottoms : 2001 / 1993 / 1985 / etc... are clearly visible on the charts !
FWIW : AU long term (>10 yrs) monthly chart, shows some nice positive momentum signals (?). A 2001/2, bottom and turnaround are higly probable. NIA !
Mr Gresham
(11/8/01; 00:07:11MT - usagold.com msg#: 64909)
Waverider
Welcome to another with that "un-American" north-of-the-border perspective. And those of us who associate you with your location in Vancouver will visualize the beautiful views you are undoubtedly enjoying out your windows as you post to us, helping to brighten the ideas we share back to you and all. The fact that you bring feminine force to our dry deliberations should help us to keep our words in line with our ideals even more than we do already...
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